Editorial: Twin States’ Destiny Is Demographics

Friday, February 02, 2018

In one sense, demographics are destiny for state governments. Population composition and trends shape policy on everything from housing to health care to education to social services to taxes. That does not mean, however, that states cannot shape that destiny to their benefit, as both Vermont and New Hampshire are now attempting to do.

The Twin States are facing what has been aptly called “a silver tsunami” caused by the aging of the baby boom generation, low birth rates, and an exodus of young people coupled with too few newcomers moving in. In his annual budget address last month, Vermont Gov. Phil Scott proposed spending $3.2 million on programs designed to attract newcomers and persuade Vermonters who have left to return to their home state. Technology exists today to identify people who might be attracted to what Vermont has to offer, Scott told the Legislature, “so let’s use these tools coupled with direct contact to close the deal.”

In New Hampshire, a pending bill in the Legislature would establish the position of state demographer and create a commission on demographic trends. It would also require bills that affect demographics to carry a note assessing their impact and state agencies to prepare 10-year budget projections adjusted for changes in demand for public services created by demographic changes. “We need better information,” said Rep. Neal Kurk, R-Weare, a sponsor of the legislation. “Let’s not go into the future blindly, and let’s say the future is longer than the two-year budget projections.”

The commission created under the bill would be assigned to set net migration goals, and to recommend programs to reach them. (Net migration refers to the difference between the number of people coming to live in the state and the number who move away in any given year.)

A study commission convened a couple of years ago noted in its final report that between 1960 and 1990, the state prospered from net in-migration as people “voted with their feet” to live in the Granite State. The average annual population increase was 16,744 people in those years, 78 percent of whom came from somewhere else, mainly Massachusetts. After that, in-migration slowed considerably and young people continued to leave, with alarming implications as the baby boom generation hit retirement age. “If this demographic trajectory proceeds unchecked,” the report warned, “it will mean decades of constrained economic growth, significant shifts in the composition of the demand for public services and private sector goods and services, and a public sector facing fiscal challenges.”

Interestingly, in-migration to New Hampshire rebounded sharply between July 2016 and July 2017, with 4,700 more people moving in than leaving. But it is considered unlikely to will rebound to 20th-century levels on its own.

Of course, attracting people, especially young people, to Vermont and New Hampshire will require more than simply better telling what the states have to offer (which is considerable in terms of jobs and quality of life). And it’s important to remember that New England’s cold climate will inevitably limit the appeal among people accustomed to milder weather. But Scott is on to something when he pinpoints lack of affordability as a barrier to attracting newcomers, repatriating former Vermonters and keeping young people at home.

Lack of affordable housing and a housing mix that does not match well with developing demographic trends is just one obstacle in both states. The vexing nature of the demographic problem is well illustrated by the education situation in Vermont, where the combination of declining student enrollment and rising costs has produced considerable pressure to consolidate services and cut costs. But little is more important to young families who are thinking of moving than the quality of the schools where they might be going. At the same time, education taxes have a real impact on affordability, so there is a needle to be threaded here to refill the state’s classrooms.

In any case, both New Hampshire and Vermont are at least thinking in a formal way about how to shape the makeup of the population to their advantage, and they deserve credit for doing so. After all, their destiny depends on it.