Vermont claimed the second-lowest unemployment rate in the nation in March with just 3.4 percent of the workforce without jobs. The national average is 6.7 percent.

It marked the sixth consecutive monthly drop in the state's unemployment rate. Coupled with growth in the workforce -- meaning more people are working or looking for jobs -- the rate is a promising sign for the state's economic recovery overall.

"It brings me comfort that we're heading in the right direction on jobs," Gov. Peter Shumlin said by phone Friday.

April numbers won't be released until May, but there is some indication that the good news could be short-lived. Weekly unemployment claims have gone up two weeks in a row, according to Department of Labor data.

The news comes as the Legislature's minimum wage debate heats up. A proposal to raise the wage to $10.50 per hour by the year 2018 was voted out of the Senate Committee on Economic Development, Housing and General Affairs on Friday. That is close to Shumlin's proposal to reach $10.10 by 2017 (the Senate plan hits $10 even in 2017), and is more gradual than the House-passed bill to reach $10.10 starting Jan. 1, 2015.

Legislative economist Tom Kavet and Labor Department economist Mat Barewicz both testified before Mullin's Senate Committee on committee this week -- even before the latest unemployment rate drop was announced -- that Vermont's low jobless figures are one indicator that the economy is strong enough to absorb a significant increase in the minimum wage.


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"But there are pockets of the state that will have a much tougher time adjusting to it," Barewicz said. He said this variation frames the minimum wage question as one of efficiency versus equity.

The state's minimum wage debate seems to have reached consensus that the current minimum wage of $8.73 per hour is not sufficient to live on. But in raising it to pay low-income earners more equitably, some policy makers also want to tread lightly to avoid interrupting the market efficiencies that are driving the state's recovery.

Two Vermonts

Seasonally adjusted numbers show growth in the manufacturing and education/health services sectors, both increasing by about 500 jobs. Leisure and hospitality picked up about 300 jobs.

Sectors showing decreases are professional and business services (400 jobs), government (200 jobs) and construction (100 jobs).

While the statewide average is low, a regional breakdown illustrates what some call "two Vermonts."

Members of the Senate Economic Development Committee brought this up in Thursday's hearing on the minimum wage.

"I think there are two Vermonts, I really do," said Sen. Kevin Mullin, R-Rutland, who chairs the committee. Mullin frequently invokes the economic woes of his district when people testify to his committee about statewide economic growth.

Rutland's labor market area is comparatively tight within Vermont, with just 3.9 percent of the workforce unemployed. Newport, on the other hand, chronically tops the list for the state's highest unemployment rate. In March, it was 6.6 percent.

That's a full point lower than 7.6 percent in March 2013, but a long way from the Burlington-South Burlington area's 3.3 percent. The lowest unemployment rates in Vermont in March were found in Warren-Waitsfield (2.4 percent) and Woodstock (3.1 percent).

Those latter areas are very lightly populated, however. Burlington-South Burlington's figures account for more jobs: About 108,350 people were employed there in March.

Shumlin concurred with the characterization of a major dichotomy in Vermonters' economic reality.

"We're trying to change that," he said.