Tuesday, March 11, 2008

More on Pittsburgh's Improved Job Growth

As noted in the previous post, re-benchmarked employment data show that the Pittsburgh Region's job growth was much better over the last year than previously thought. How do we compare to other regions?

Although we've hardly become a leader in job growth, we're also no longer in the cellar. Between 2006 and 2007, the Pittsburgh Region created 8,400 net new jobs, an increase of 0.74%. 12 of the top 40 regions had slower job growth than Pittsburgh, including some that may surprise you -- we had faster job growth than sunbelt cities like Los Angeles, Miami, San Diego, and Tampa (Tampa actually lost jobs in 2007) as well as Cleveland, Detroit, Minneapolis, Philadelphia, and St. Louis. We looked even better in January 2008, when our region had faster job growth than 14 of the top 40 regions, including Baltimore and Chicago.

Pittsburgh's growth rate in 2007 was about 2/3 of the U.S. job growth rate, the best ratio since before the 2001 recession. This is partly due to the increase in job growth in Pittsburgh, but also partly because of a significant drop in job growth nationally. As you can see in the chart, the growth rates in Pittsburgh and the U.S. converged in 2007. The convergence has continued, and job growth in Pittsburgh and the U.S. were almost identical in January 2008 (compared to January 2007).

The question is whether and when the looming recession nationally will pull down job growth in Pittsburgh. The same pattern occurred in the 1999-2002 period; Pittsburgh's economy was accelerating as the U.S. economy was slowing, but after the recession hit, Pittsburgh lagged in its recovery.

In fact, although Pittsburgh's job growth in 2007 is good news, it's important to note that the total number of jobs in Pittsburgh is still over 8,000 below the levels in 2000-2001, i.e., we still haven't fully recovered from the 2001 recession. However, we have some interesting company -- the same is true of Boston, Chicago, San Francisco, and Silicon Valley, as well as Cleveland, Detroit, and Milwaukee.


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