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Covid-19 made a bad situation worse for many Vermonters

It also revealed the crucial role of government, not just in crises, new report shows

The recession created by the Covid-19 pandemic, beginning in February 2020, ended the longest economic recovery on record. The highest-income Vermonters came out of that recovery better off. But no one else did. Those at the bottom had less income in 2019 than in 2007 before the start of the Great Recession. Real median household income—the middle of the scale—ended 2019 where it was in 2007. And the state’s poverty rate showed no improvement.

So when Covid-19 suddenly put nearly 100,000 Vermonters out of work, many were already in economically poor shape. Nearly $5 billion in federal assistance to Vermonters this year definitely helped Vermonters weather the pandemic, so far. But more is needed, now and in the future. The state needs to invest in the public good—child care, education, housing, and other essentials—to secure the long-term economic well-being of Vermonters.

This story, reflecting the challenges of Vermont’s top-heavy economy and the exacerbating effects of the pandemic, is laid out in State of Working Vermont 2020, released Dec. 28 by Public Assets Institute in Montpelier. Vermont’s economy expanded, but too many Vermonters haven’t seen the benefits of this growth. Wages increased, but more for high-wage workers than for those earning less.

Child poverty hit its lowest point in 16 years, but remained at nearly 10 percent. Inequality grew: Half of all 2019 income in the state went to the top 20 percent of Vermonters.

“Policy makers deserve a lot of credit for their handling of the pandemic,” said Paul Cillo, founder and president of Public Assets, “but we need to think beyond this crisis. After decades of policies that disproportionately harm people of color and those on the lower rungs of the economic ladder, the state needs to shift its focus not just to people’s basic needs but also to racial and social equity.”

The report includes a graphic breakdown of 2020 federal pandemic aid and how Vermont is using it, as well as stories in Vermonters’ own words about their lives during the pandemic. “What we kept hearing in these stories was a feeling of insecurity—about jobs, food and housing, the care of children and elders, and about the future,” Cillo said.

Yet some who received relief from the government also recognized what a little help from the state can do: take the edge off the anxiety and pressure of living on a low wage, open up time to think and heal, and offer opportunities for a better life. “Vermonters are looking for opportunity and a reason to hope,” said Cillo. “They deserve nothing less from our policy makers.”

Public Assets produces the State of Working Vermont annually in conjunction with the Economic Policy Institute in Washington, D.C. The report shows how working Vermonters and their families were faring economically at the end of 2019—the latest year for which most data are available—and how conditions have changed, for better or worse, in recent years. Its analyses are based on data released in 2020 by the U.S. Census, U.S. Bureau of Labor Statistics, and other state and federal agencies. This year’s report also uses available data and stories from 2020 to document this extraordinary year of Vermonters’ lives during a deadly pandemic.

State of Working Vermont 2020 can be viewed or downloaded at publicassets.org.

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