The New England Council Releases Studies on Vermont’s Aging Workforce

BURLINGTON, Vt.--(BUSINESS WIRE)--New England’s aging workforce could stall economic development and job growth in the future, according to a report prepared by Northeastern University’s Center for Labor Market Studies. The report was released today as part of The New England Council’s Older Worker Initiative. The numbers are significant in Vermont which the report indicates has a somewhat larger and more rapidly growing share of the older population than the rest of the nation.

“We believe that New England is at a critical juncture. The aging population creates important challenges and significant opportunities for developing strategies to respond to these inevitable workforce changes. We need to develop specific proposals to encourage the active engagement of older workers in the employment market”

“As the baby boom generation enters retirement age, New England employers will become increasingly dependent on older workers – those aged 55 and above – to meet the demand for skilled workers. The ability to retain and recapture these older workers in the labor force will be critical to the long-term economic prosperity of the region,” said James Brett, president and CEO, of The New England Council, the nation’s oldest regional business organization.

Mercer Human Resource Consulting is the lead company sponsoring this Initiative which is operating working group sessions around the region to develop strategies on this issue. James McCaffrey, Mercer’s New England Market Leader and member of the Council’s Board of Directors, is chairing the Initiative. He said the issue, at its core, will likely result in public policy changes to the nation’s retirement system.

“We believe that New England is at a critical juncture. The aging population creates important challenges and significant opportunities for developing strategies to respond to these inevitable workforce changes. We need to develop specific proposals to encourage the active engagement of older workers in the employment market,” McCaffrey said. “Retirement regulations – both on a state and federal level – often actually encourage workers to retire early and not return to the workforce. In New England, we could find a significant gap of available employees and skilled worker shortages that ultimately will hinder our ability to add jobs and grow.”

Paul Harrington, Associate Director of Northeastern University’s Center for Labor Market Studies, said the findings in Vermont are significant.

“The aging of Vermont’s population has several consequences for overall economic growth in the state. Without sizable increases in skilled foreign immigration and or migration of residents from other states in the nation into Vermont, the state’s population will continue to grow older and the consequent decline in the childbearing age population will continue to reduce the already low birth rate in the state,” Harrington said. “In the meanwhile, the state will increasingly have to rely on the older population for labor supply.

“Concerns about the labor supply in Vermont have already been raised and the state has been working on developing strategies designed to attract young workers into the state and retain them.”

Some of the report highlights:

- The Vermont population is forecast to rise at a pace not far behind that of the national working age population growth rate through 2015. Census projections for Vermont forecast a population increase of 9.2 percent for those aged 16 or older. The trend varies sharply among age groups.

- All of Vermont’s labor force growth, and population growth, in the future will be among those aged 55 and older.

- The Vermont working age population will age rapidly over the next 10 years. The number of teens and young adults will fall over the forecast period. From 2005 to 2015, the number of people ages 16 to 24 will decline eight percent.

- The number of Vermont residents in the 25 to 34 year old group is expected to increase 25 percent. This will be offset by the 35-54 group, which is expected to decline 11 percent in the same time period.

- From 2005 and 2015, the share of 55 plus population in Vermont is projected to increase 32 percent. Similarly, the population of those 65 and older is expected to increase about 38 percent.

- The average age of Vermont residents is higher than that of their national counterparts.

- In 2004, Vermont had the lowest birth rate among 50 states in the nation and the District of Columbia.

As part of this Initiative, members of the New England Council, the Vermont Business Roundtable, and other business leaders will meet in Burlington this week to discuss a variety of issues such as: pension policies that limit workers’ ability to mix work and retirement income, workforce development programs that do not serve older workers, and the need for the workplace to accommodate an older workforce.

The Council plans to host meetings around the region in the coming months, examining the status of older workers in each state and engage public and private leaders in discussion of the issues.

The New England Council, founded in 1925, is an alliance of large and small companies, colleges and universities, nonprofit and other agencies, dedicated to promoting economic development and a high quality of life in the six-state region.

Mercer Human Resource Consulting is a global leader for HR and related financial advice and services, with more than 15,000 employees serving clients in more than 190 cities and 40 countries and territories worldwide. The company is a wholly owned subsidiary of Marsh & McLennan Companies, Inc., which lists its stock (ticker symbol: MMC) on the New York, Chicago, Pacific and London stock exchanges.

Editors: For more information or a copy of the report, contact: Susan Asci, The New England Council, 617-723-4009, ext. 27, or sasci@newenglandcouncil.com