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Vermont. Jeffrey B. Carr and Zachary H. Sears. Economic & Policy Resources, Inc. Media sponsor: ... Payroll Job growth has now turned negative (Yr-Yr basis) ... – PowerPoint PPT presentation

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Title: Vermont

  • Jeffrey B. Carr and Zachary H. Sears
  • Economic Policy Resources, Inc.

Media sponsor
Current Vermont Conditions
  • A lot has happened in the Vermont economy since
    last Springwith most major indicators
  • Payroll Job growth has now turned negative (Yr-Yr
  • Unemployment has increased to 5.2 (for Sept.),
    even though it remains lower than U.S. and 4 NE
  • Consumption spending is restrained (based on
    sales tax revenues) and the freeze in credit
    markets has stalled car sales
  • The Housing Market is weakbut could be worse.
  • Construction spending has nose-dived
  • Mortgage Delinquency rate remains low (6th in
    U.S. - 1st in N.E)
  • House prices have only recently shown
    declinesVermont price declines have been no
    where near the level experienced in other states.
  • The revenue forecast for the state was downgraded
    just this week by roughly 100 million or 4.3 in
    the General Fund.
  • The forecast for fiscal year 2009 and 2010 has
    been reduced by more than 200 million since
    January of 2008.

Current Vermont Conditions
  • The few positives there are out there are few
    and far between.
  • Canadian visitor activity remains positive, but
    the appreciation of the U.S. dollar has seriously
    cut into the economic incentive to shop south of
    the border.
  • Advance bookings for the Winter tourism season
    are up significantly, but bookings under
    stressful economic circumstances (such as now)
    are often insecure and vulnerable to
  • The energy price situation has improved relative
    to last May and from the mid-July fossil fuel
    price peak.
  • This has eased what was an unprecedented 800
    million (at annual rates) run-up in energy prices
    that occurred during the first half of calendar
    year 2008.
  • This will help visitors, residents, and
    businesses across our rural state where residents
    and visitors alike drive everywhere, and where
    businesses--particularly manufacturing
    businessesare very energy-intensive.
  • But it wont help those who locked in at
    earlier, higher prices

The forecast is for a rough couple of yearswith
VT in the middle of the pack
The Housing Market in Vermont
  • House prices will decline for 7 consecutive
    quarters beginning in 2008Q2but will recover
    relatively early in 2010Q3

Mortgage Delinquency Rates Will Get Worse
  • even though Vermont is currently the 6th lowest
    in U.S. and lowest in the region.

Worst Recession in Vermont since World War II,
except for the early 1990s
The Vermont OutlookBad, But It Could be Worse
  • The threats are looming, after all, this is a
  • Slow down in domestic tourism,
  • Appreciation in U.S. dollar vs. the Canadian
  • A slowing second home market,
  • The job losses are mounting with layoffs
    increasing--the factory sector such as autos and
    semiconductors), financial services, Real Estate
  • Public sector cutssome services could be cut?
  • But there are some positives
  • Relatively few forced liquidation and distressed
  • House prices are not expected to decline as much
    as other N.E. states, and prices should recover
  • Lower energy prices are good for the states
    tourism industrybut they are not low enough,
  • Ski resorts are poised for a good winter, but
    will the weather and energy prices cooperate?

The Vermont OutlookBy The Numbers