Friday, October 19, 2007

Regional Job Growth Continues to Slow

The preliminary September job figures for metro regions have been released, and the news for Pittsburgh is discouraging. There were only 3,000 more jobs in the Pittsburgh Region than a year ago, a growth rate of only a quarter-percent (0.26%). The U.S. economy grew more than 4 times as fast (1.2%), and most other regions grew faster than we did. In fact, Pittsburgh's job growth was slower than all of the top 40 regions except for Cincinnati, Cleveland, Detroit, and Providence.

More depressing is that the rate of job growth here declined from August to September, rather than improving. And the 0.25% growth rate in September was the slowest rate in the past 16 months (since May of 2006). As a result of the slow job growth, we still have 5,000 fewer jobs than we did in 2001.

What's causing the problem? It's not USAirways, or the banks, or manufacturing. It's everything. The economic malaise cuts across almost every sector of our economy. The construction, manufacturing, retail, and information sectors all lost jobs over the past year, and the finance, transportation and utilities, and leisure and hospitality sectors were stagnant. The largest contributors to job growth in the past year were health care (2,300), professional, scientific, and technical services (1,000 jobs), and education (800 jobs). And although health care grew significantly relative to the rest of our economy (1.9%), it grew well below the rate of growth in the health care sector nationally (3.3%), undoubtedly because of the lack of population growth here.

The most likely explanation for our continuing economic malaise is a bad state business climate and insufficient attention to entrepreneurship. And unless we fix those things, we can expect more bad job growth reports in the months ahead.

1 Comments:

Blogger Citizen Driven said...

It is becoming increasingly difficult for the small to medium sized businesses to compete with the growing national companies. The cost for businesses that is increasing rapidly is healthcare. Businesses want to provide the benefits that the larger corporations are giving to their employees. However, the health insurance companies are willing to provide larger discounts to the larger companies, where as the smaller companies are receiving smaller discounts. This creates a competitive edge for the larger companies because they are paying less per person for health insurance, but receiving better benefits.
I support methods to close this gap that exists between the small business and the large business. Giving all our businesses the necessary tools to succeed and provide for their employees is essential to a bustling economy within a community. If such methods allow businesses to better care for their employees, increase their profits and save the consumers money, then we must begin looking at alternatives to what currently exists.
Healthcare is a hot issue in the United States, and it will continue to be a hot issue until progress is made. We have seen what is possible with sCHIP; let us see what is possible with helping our local businesses.

12:45 PM  

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