Vermont needs to add around 13,500 people to its workforce each year over the next decade to keep up with labor demand and sustainably grow its economy, according to the Vermont Futures Project.
The aim of the organization’s first Economic Action Plan is to provide Vermont with a roadmap for “crafting a robust economy” by dramatically increasing its population and housing stock. The report was unveiled at an annual conference hosted by the Vermont Chamber of Commerce earlier this week.
“The plan tackles the root causes that are driving the cost of living up, and we outline a path towards affordability and abundance,” said Kevin Chu, the executive director of the Vermont Futures Project.
Those root causes, according to the plan, are Vermont’s housing crisis and its gaping “workforce gap,” or the disparity between the number of people leaving the workforce each year and those joining it.
Approximately 17,150 Vermonters are expected to retire per year over the next decade, according to data from the Vermont Department of Labor cited in the plan. Meanwhile, the report assumes an additional 4,550 jobs open up annually for a variety of other reasons, including new job creation.
The plan estimates that only 8,200 people will join Vermont’s workforce each year largely due to its low fertility and college graduate retention rates, among other factors.
To close the workforce gap, the plan suggests, Vermont would need to add 13,500 people to its labor force annually over the next decade. That would bring its overall population to more than 800,000 residents by 2035 — an increase of about 150,000 from the current number.
That’s a tall order for a state that has struggled with a mostly stagnant population in recent years. According to census data, Vermont’s population just barely rose between 2022 and 2023, and in 2024 the state experienced its first year-over-year population decline since 1957.
Such dramatic population growth would also strain Vermont’s already tight housing market, the plan acknowledges. According to the most recent Vermont Housing Needs Assessment, the average price of a single family home rose by 38% between 2019 and 2023. To ease those costs while housing the thousands of people that Vermont needs to meet its labor demand, the plan suggests that the state would have to build over 60,000 housing units over the next decade.
“It’s definitely going to require collective action in order to hit some of these ambitious long term goals,” Chu said.
The plan outlines a variety of strategies to do that, including recommendations that the state launch a targeted marketing campaign to encourage migration to Vermont and establish itself as a haven for veterans by making military pensions fully exempt from state taxes.
At the same time, the plan calls for a 40% reduction in development timelines and regulatory costs over the course of the next decade, suggesting that the state needs to streamline its “overly complex regulations, outdated zoning laws, and slow appeals processes.”
But some policy analysts question whether Vermont needs to grow its population and economy rather than work on redistributing wealth among the people already in the state.
“We often hear that growing the workforce or growing the economy will make life better for all Vermonters,” said Steph Yu, executive director of the Public Assets Institute, in a written statement. “But that has not been true in the past and it ignores the challenges many Vermont families face.”
Yu suggested that Vermont’s workforce gap is less at issue than its wage gap. “We’ve gone from having the highest minimum wage in the region to one of the lowest,” she said. “We know that the cost of housing has strained a lot of budgets, as have healthcare costs. That requires more government investment, not less. Increasing the population will not solve this problem.”
Read the story on VTDigger here: In new plan, economic group calls for adding 13,500 to Vermont’s workforce each year .