Single parent households suffer most

ST. ALBANS — In 2009, median family income in Vermont fell to 2001 levels, according to a study released by University of Vermont economist Art Woolf and his business partner, Richard Heaps. They are publishers of Vermont Economy Newsletter.

Woolf and Heap's analysis is based on tax data from the State of Vermont.

For married couples filing jointly, median income fell $1,275 or 1.9 percent in 2009 to $64,900. The decline follows an even greater decline in 2008 of 2.7 percent.

Since the onset of the recession, median income in Vermont has fallen by $3,100 per household, according to Woolf's analysis.

A measure of family income, which includes single parent families as well as married couples filing jointly, shows a smaller income and an even greater decline. Median income for this more expansive definition of family was $55,241, and had declined 2.4 percent in 2009 and 2.7 percent in 2008.

"Single parent families have been hit harder," Woolf told the Messenger this morning, adding that having a spouse in the household served as an "insurance policy." When one person lost a job or had hours reduced, the other person could help to make up the lost income, he explained.
"Their incomes are lower and they suffered a bigger decline in real income," Woolf said of single-parent families.

The income declines show "the extent to which the recession has effected the average Vermont family," Woolf said in a written statement.

“Vermont suffered significant job losses in 2008 and 2009, which contributed to the income decline,” said Richard Heaps, who co-authored the study with Woolf. The 2010 data have not yet been gathered, but Heaps said the pair expect real median family income will have risen because the state payroll tax withholding increased in 2010 and a "better jobs situation."

Heaps predicted the economy will strengthen in 2011 and that the cut in Social Security taxes, which was part of the tax compromise delaying the expiration of the Bush tax cuts will result in an increase in income.