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Vermont’s aging population shrinking peak-earning cohort, JFO presentation says
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Summary
A Joint Fiscal Office presentation to the Ways & Means Committee showed Vermont’s post‑pandemic growth was concentrated in younger adults but that the state’s 55–64 prime‑earning cohort declined sharply, with implications for tax revenue, health and care workforce needs and basic‑needs calculations.
Pat, a staff member with the Joint Fiscal Office, told the Ways & Means Committee that post‑pandemic migration and changing age cohorts have altered Vermont’s population makeup and the state’s tax base.
"In 2021 the population swelled by 41,100 people," Pat said, describing the pandemic-era influx that was followed by much smaller net changes in 2022 and 2023. Pat said the state population was "a little under 650,000" in 2023 and that preliminary 2024 estimates show a modest decline that may be revised.
The presentation summarized the Joint Fiscal Office issue brief by Joyce Banchessa and focused on three trends: a decrease in children (ages 0–17), an increase in younger adults (roughly ages 25–39), and a notable decline — about 6,100 people — in the 55–64 cohort that historically contains many of the state’s highest earners. Pat noted a more than 10% increase in the 65–79 group and a roughly 10% increase in residents over 80 across the 2020–2023 period.
Why it matters: Vermont’s 45–64 and especially 55–64 age groups account for a disproportionate share of high household incomes, so a decline in those cohorts can reduce income tax receipts and change the composition of taxable income. Pat said households headed by people ages 45–64 make up "52% of Vermont households with income over $200,000" in the data cited, while many households headed by people over 65 report much lower incomes.
The presentation separated the components of population change: natural change (births minus deaths) and migration. Pat said births to Vermont residents were roughly 5,100 while deaths were about 6,900 between 2022 and 2023, producing a negative natural change of roughly 1,800 people that was offset by domestic and international in‑migration. The Census counts used in the briefing capture the whole resident population, Pat said, regardless of immigration status.
Pat also summarized household income and the Joint Fiscal Office’s Basic Needs Budget, which estimates the wage needed for households to afford basic expenses without public assistance. The committee heard that basic‑needs calculations rose substantially for some household types because of inflation and housing cost increases but fell for some households with children after accounting for expanded child‑care subsidies (the committee was told eligibility can extend to 575% of the federal poverty level).
A Ways & Means committee member responded with an opinion on wages and policy: "Anyone who thinks you can live a real dignified life on $20,000 ... it's just not right," the committee member said, urging attention to wage levels relative to basic needs calculations.
No formal motions or votes were taken during the presentation. Committee members asked for additional charts and for the JFO to provide more detail on 2024 estimates as those data are finalized.
Pat closed by listing possible policy considerations from the issue brief, including watching how age cohorts move through peak earning years, monitoring the workforce available for elder and child care, and recognizing that shifts in where income originates (wages versus retirement and Social Security) can change taxable income. The committee arranged to continue related discussions with the education committee later in the day and asked staff to share the JFO materials for follow‑up analysis.
