Friday, December 21, 2007

No News is Bad News

If you were hoping for some better economic news about the Pittsburgh Region before the end of the year, you're going to be disappointed. The job statistics for November were just released, and the Pittsburgh Region's economy remains in the doldrums.

Between November 2006 and November 2007, the Pittsburgh Region only created 3,000 net new jobs, a mere 0.26% growth rate. That's the fifth worst job creation rate among the top 40 regions.

The U.S. economy has been slowing, though, so even though Pittsburgh's job growth hasn't been improving, it's doing a little better relative to the U.S. In November, our job growth rate was 1/4 the national growth rate, whereas in several previous months we were growing at less than 1/5 the national rate. However, even though our economy is doing a little better in a relative sense, it's still doing badly in absolute terms, and that's what counts to the people who are looking for jobs here.

If you look at the most current statistics, it would appear that the job growth rate in November was slightly better than in the two prior months. But that's because in both October and November, the preliminary job figure for the prior month was revised downward. The preliminary figures for September and October were 3,000 new jobs, the same as what is being reported for November. The job totals for September and October have now been revised downward to only 2,500 and 2,400 respectively. It's possible that the same will happen with the November job figures (which are currently preliminary) when the December figures come out next month.

Right now, with only one month left in 2007, the average job growth rate for the year looks like it will be almost identical to last year -- less than 5,000 net new jobs, and a job growth rate of less than one-half percent. Even that 5,000 job average for the year will be misleading, however (as have the year-to-date figures so far this year), because the job creation rate in the first few months of 2007 were much higher (double or even quadruple) than what they have been since May.

In fact, 2007 looks like it will end as having the fourth-worst job creation rate of any year in the past 15 years, except when the U.S. economy was shrinking. (By way of comparison, the Pittsburgh Region created between 7,000 and 20,000 net new jobs every year between 1992 and 2001.) And that's bad news for people who want to live and work in the Pittsburgh Region.


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