By Guy Page
Vermont is ranked 51st out of 51 (50 states and Washington D.C.) in economic momentum. The Vermont Legislature needs to do more to turn that around, lawmakers heard from 50 manufacturers from across Vermont gathered at the State House on April 2.
Vermont was predicted by industry experts to lose 3% of its momentum over 10 years. Instead, the Green Mountain State hit that negative target in the first year, Vermont Chamber of Commerce spokesperson Megan Sullivan told VDC last week.
Sullivan is scheduled as a guest today at 11 AM on Hot Off The Press on WDEV AM 550, FM 96.1, and radiovermont.com.
Sullivan emphasized that it’s not all bad, in the State House or across Vermont. The House passed H.933, which includes a research & development tax credit. The bill is now in Senate Finance. Combined with UVM’s emerging Tech Hub, and a growing tech hub in Rutland, passage of this bill into law could make Vermont a leader in innovation.
“The way you [in Vermont] can compete globally is innovation,” Sullivan said. Vermont may lack the energy, regulatory, and workforce advantages of many states, but if given an edge like the tax credit, the Green Mountain State could become an innovation hub not only at UVM but statewide.
The manufacturers pressed lawmakers to reduce regulatory and economic barriers they say are limiting growth in one of the state’s most important industries. For example, one business on the Connecticut River highlighted the state’s childcare payroll tax as a significant disadvantage, compared to New Hampshire. Their employees all pay the tax, but that none of the state revenue has percolated down to Windham County child care providers.
The April 2 event, dubbed “Vermont Manufacturing Day,” brought business leaders face-to-face with legislators and top state officials, including John Rodgers, for a series of hearings, forums, and a House resolution recognizing the sector’s contributions.
Representatives from companies including Nolato, Built By Newport, Vermont Frames, Chroma Technology, and Vermont GaN Tech Hub testified before House and Senate committees, outlining both opportunities and ongoing challenges.
“Manufacturing is one of the clearest pathways we have to grow Vermont’s economy,” said Amy Spear, president of the Vermont Chamber of Commerce. “It supports communities across every region and creates opportunity for Vermonters to build careers, support their families, and stay rooted here.”
Housing, permitting, and costs top concerns
Industry leaders identified several persistent obstacles: a shortage of affordable housing for workers, what they described as a complex and time-consuming permitting process, high property taxes, and rising health care costs.
Those barriers, manufacturers said, make it difficult both to expand existing operations and to attract new companies to Vermont.
Industry leaders also say the state-funded regional development corporations, as well as state-level economic development offices, aren’t doing a good enough job ‘selling’ Vermont’s benefits and programs (childcare funding, low crime, quality of life etc.) to out-of-state businesses considering relocation.
Workforce development was also a major focus, with speakers emphasizing the need to grow the talent pipeline through expanded Centers for Technical Education (CTE) programs and other training initiatives tied to advanced manufacturing.
At the same time, participants pointed to opportunities, including a new state research and development tax incentive, which they said could help spur innovation and investment if paired with broader reforms.
A major piece of Vermont’s economy
According to data shared at the event, manufacturing generates an estimated $2.92 billion in economic impact annually, accounting for about 7% of Vermont’s gross state product and supporting roughly 26,600 jobs — also about 7% of the state’s workforce.
The sector spans a wide range of industries, from precision optics and semiconductors to wood products and specialty manufacturing, with companies operating in both rural and urban parts of the state.
Manufacturers also emphasized Vermont’s strategic position in regional and international markets, citing economic ties to New England, New York, and Canada.
Call for legislative action
Throughout the day’s testimony and discussions, a consistent message emerged: without action to address cost pressures and streamline regulations, Vermont risks losing ground in attracting and retaining manufacturing investment.
Business leaders urged lawmakers to focus on policies that lower costs, simplify permitting, and support workforce housing — steps they say are essential to sustaining growth in a sector widely viewed as a cornerstone of the state’s economy.
The event concluded with a House resolution formally recognizing April 2, as Vermont Manufacturing Day, underscoring bipartisan acknowledgment of the industry’s role.