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Business Climate in Vermont

We hear over and over again from the political Right that Vermont is a terrible place to do business. Yet there is explosive growth and development taking place in one of our historically poor regions: the Northeast Kingdom (NEK). WCAX has aired several stories from entrepreneurs in the NEK reflecting on what a wonderful place to do business Vermont is. That made me wonder where the truth lies.

What is the data? And how does it reflect on employment, income and the quality of life in Vermont?

Vermont currently has the second-lowest unemployment rate in the US.1 Only North Dakota is doing better, and that state is experiencing a oil boom. We are doing it without the benefit of discovering oil.

We have the second-highest high school graduation rate in the nation.2 Our rate of people over the age of 25 with a bachelor’s degree is the nation’s 7th highest at 33.1%. A good 13.1% of us has an advanced degree beyond the bachelor’s, which ranks us the 6th best in the nation. Our work force tends to be better educated and more ready for good employment.

Vermont enjoys a higher per capita income by almost $800 per person than the national average.3 The same source shows that Vermont’s percentage of people living below the poverty line is 3.3 points lower than the national average (11.6% in VT compared to 14.9% for the US). Further, the home ownership rate is 5.7 percentage points higher (71.2% compared to 65.5% for the US). We Vermonters look prosperous compared to other Americans.

Vermont does not rank so well in business start-ups, coming in ranked 21st out of 51 US jurisdictions (including the District of Columbia).4 But still that is nowhere near the bottom as the gloom and doom Right would have you believe. On the positive side, when entrepreneurs do start a new business in this state, there is a low failure rate. Vermont ranks 3rd in the “Least Percent Decline in Employment from Firms Less than Three Years Old.” So much for the Right-wing claim of low support of entrepreneurship.

Just to make sure we are not looking at isolated successes, I looked at the volume of business activity. We are, after all, a small, rural state, and most of our economic health depends on small business. According to the US Census, Vermont’s per capita retail sales of $15,005 is well above the national average of $12,990.

In general, we are better-educated, wealthier, more engaged in the economy, and more supportive of new business than is the rest of the US population.

What is there for a business not to like?

The Right will respond with one word, “taxes,” but that also does not bear up under close inspection. I’ll deal with that issue in a separate paper on our tax burden.

I invite you to look at the “Comparative Economic Data” spreadsheet please use this link.

As always, I invite you to share your ideas or pose questions through email. Let us not accept “facts” on the basis of ideology. We should always try to ferret out the data so we can make fair and reasonable judgments on political matters and social policy.

 

1 US Bureau of Labor Statistics, data for April, 2014

2 US Department of Education, 2011 data.

3 US Census Bureau, 2012 data.

4 www.fastcompany.com