While it sounds like great news, Vermont’s record low unemployment rate is actually a problem for businesses looking to grow or maintain staffing levels, according to labor officials.
The Vermont Department of Labor announced Monday that the seasonally adjusted unemployment rate for the month of January was 2.5 percent, a decrease of one tenth of one percent from the seasonally adjusted, revised December rate. According to the department, that’s the lowest the rate has been since the U.S. Bureau of Labor Statistics started keeping records in 1976.
Mathew Barewicz, director of the economic and labor market information section of the Vermont Department of Labor, said Monday the rate is adjusted to account for seasonal shifts in employment numbers, including holidays and when schools let out.
Traditionally, a 5-percent unemployment rate is considered an optimal employment rate, Barewicz said. It leaves employers with a deep enough pool from which to recruit, and job seekers with enough options to move around. An extremely low unemployment rate means there are more jobs than people to fill them.
He said employers are having a tough time filling new positions and vacancies caused by retirement.
Growing industries in Vermont include leisure and hospitality, business professionals and technology, and healthcare and social services. Industries looking to retain workers include healthcare, construction and manufacturing, he said.
Barewicz said this isn’t a new problem and won’t be solved quickly. He said efforts are being made by various agencies to increase Vermont’s labor pool. The Department of Labor has a number of programs that train job-seekers for the work employers are seeking. Likewise, it has resources employers can use to train current or prospective employees for new roles.
William Moore, president of the Central Vermont Chamber of Commerce, said Monday that while the Department of Labor is only factoring people looking for work in its statistics, the 2.5-percent unemployment rate means there’s virtually no unemployment in Vermont.
“Part of it is we have the second oldest workforce in the country,” he said. While people are coming to Vermont to retire, many young people are leaving for a variety of reasons.
One reason, he said, is young folks want to work somewhere that will let them make a difference in their community. He said he only has anecdotal evidence to support this, but some of his Chamber’s members report offering incentives that let employees do community service projects.
He said a lack of strong internet infrastructure is also encouraging young people to seek their fortunes elsewhere.
Brett Long, deputy commissioner of the Agency of Commerce and Community Development, said the state is looking at several long-term strategies to solve its employment woes. One that got a lot of attention recently was offering remote workers $10,000 to move here from out of state. Other initiatives have involved working with businesses and educators to train employees to move up the ranks within their own companies, and showing students as early as middle school the options available to them in the vocational sector. Businesses have also been encouraged to do more with internships in an effort to keep college graduates from leaving.
Other efforts have been more along the lines of marketing. One, he said, takes people vacationing in Vermont to showcase the state’s offerings should those people choose to stay and work here.
“On its face, the idea of a ‘historically low unemployment rate’ sounds like a positive outcome and for current job seekers, it is. However, for employers and the state overall, this level of unemployment is impeding economic growth,” said Lindsay Kurrle, commissioner of the Department of Labor. “... The Department is actively working to get the message out there that there are great jobs in Vermont for individuals of all skillsets and backgrounds. Efforts to recruit need to be focused on bringing new workers into the state, and also bringing current residents back into the labor market.”