Wednesday, April 12, 2006
Curious Job Growth in the Pittsburgh Metro Area
February’s job numbers for the Pittsburgh region suggest that something very odd is happening. Even though there was a pickup in the pace from January’s year over year gain, the increase was accounted for almost entirely by two sectors, one being education and health and the other, leisure and hospitality. Indeed, 10,500 of the total 11,500-service job rise were in those two categories, with an astonishing 6,100 in leisure and hospitality alone, representing a 12-month growth rate for that sector of 6.3 percent. Another 4,400 jobs were added by health and education, a more modest but still robust 12-month gain of 3.3 percent.
All other private service sectors combined managed to post a tiny 1,000-job gain, which represents a meager 0.2 percent rise from the year earlier figure. Goods production employment was unchanged.
While any job growth is obviously welcome, it is not very reassuring to learn that eating and drinking establishments account for a large fraction of the gain. After all the average pay in that industry is among the very lowest of any sector.
Nationally the two sectors, which showed such amazing growth in Pittsburgh, rose much more modestly—2.4 percent for education and health and 1.9 percent in leisure and hospitality. Obviously these are very good numbers, but even so their combined growth amounted to only 30 percent of the national increase, more in line with the fact that they represent about 25 percent of all employment.
In Pittsburgh, the two sectors account for about 29 percent of total employment yet they represent 90 percent of job growth in February. One is constrained to ask, what is going on? These numbers are so odd as to call into question their accuracy. In all likelihood, we will have to wait for a few more months’ data to learn whether the odd job picture is confirmed or turns out to be a short-term anomaly.
All other private service sectors combined managed to post a tiny 1,000-job gain, which represents a meager 0.2 percent rise from the year earlier figure. Goods production employment was unchanged.
While any job growth is obviously welcome, it is not very reassuring to learn that eating and drinking establishments account for a large fraction of the gain. After all the average pay in that industry is among the very lowest of any sector.
Nationally the two sectors, which showed such amazing growth in Pittsburgh, rose much more modestly—2.4 percent for education and health and 1.9 percent in leisure and hospitality. Obviously these are very good numbers, but even so their combined growth amounted to only 30 percent of the national increase, more in line with the fact that they represent about 25 percent of all employment.
In Pittsburgh, the two sectors account for about 29 percent of total employment yet they represent 90 percent of job growth in February. One is constrained to ask, what is going on? These numbers are so odd as to call into question their accuracy. In all likelihood, we will have to wait for a few more months’ data to learn whether the odd job picture is confirmed or turns out to be a short-term anomaly.
