Sunday, September 20, 2009

Holding Steady

Jobs held steady in the region in August for the third straight month, giving even greater evidence that the recession has finally bottomed out here. The Pittsburgh Region has lost just over 32,000 jobs in the past year, or about 2.8% of our job base, and there has been essentially no change in those figures from June through August. (Although the total number of jobs in the region decreased by almost 3,000 between July and August, the number of jobs always decreases in August by a similar amount due to seasonal factors. On a seasonally adjusted basis, the number of jobs has been constant throughout the summer.)

The Pittsburgh Region continues to perform better than the U.S. as a whole; while job losses nationwide have slowed dramatically over the past several months, U.S. job losses continued to creep upward by a tenth of a percent per month over the past two months, in contrast to the stability here.

Similarly, the Pittsburgh Region continues to do better than most regions in the country; the rate of job loss here was the 12th lowest among the top 40 regions.

However, this is not true in all sectors. Workers in mining, construction, wholesale and retail trade, information, finance, and professional and business services have been less likely to lose their jobs here than their counterparts in most regions. But workers in manufacturing, higher education, hospitals, leisure and hospitality, and government have been more likely to lose their jobs here than elsewhere.

Wait a minute – we’re losing jobs in higher education and hospitals? Aren’t health care and higher education growth sectors? Not exactly – they’re recession-resistant sectors, which is different. Although jobs in higher education had been growing slightly until earlier this year, that has changed in the last two months, and we had 600 fewer jobs in colleges, universities, and professional schools in August than a year ago; in fact, we were one of the only regions with a significant higher education sector to report job losses. Whether this is a temporary phenomenon remains to be seen.

Similarly, after adding jobs for 17 straight months, hospital employment has declined slightly since June, and we were one of only a few regions to see job losses in hospitals. Ambulatory health care (e.g., doctor’s offices) continued to add jobs in August, as did nursing homes, so on the whole, health care has continued to add jobs, but that doesn’t mean that no one in healthcare has been affected.

Our biggest job losses continue to be in manufacturing, and we continue to lose additional manufacturing jobs every month. As of August, we’ve lost 11,000 manufacturing jobs in the past year, over 11% of the manufacturing jobs that were here a year ago. That’s the 10th biggest loss of manufacturing jobs among the top 40 regions. While that’s only half as bad as Detroit, which has lost 22% of its manufacturing jobs in the past year, it’s twice as bad as Boston, which has lost fewer than 5% of its manufacturing jobs in the past year.

Another group that’s been disproportionately affected here are temporary workers. Employment services businesses have cut 3,400 jobs over the past year, or 17.1% of employment a year ago. That’s the biggest percentage reduction of any sector in the region. Many businesses cut temporary jobs first when a recession hits, so it’s not surprising that we’ve lost jobs in that sector; almost every region in the country has. But it’s not clear why we’ve lost more temporary employment jobs than so many other regions.

Overall, while it’s very good news that total job losses here seem to have come to a halt, there are still problems in many important sectors, particularly manufacturing, that could create ripple effects in the months to come and slow our region’s recovery.


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