Pittsburgh metro private jobs recovery in 2021

Background:  In April 2020, the seven-county Pittsburgh Metropolitan Statistical Area (MSA) (Allegheny; Armstrong; Beaver; Butler; Fayette; Washington and Westmoreland) suffered a loss of 219,000 private sector jobs from the April 2019 reading, an astounding decline of 20.3 percent. Although employment began to recover through the rest of 2020, the December count was still 98,400—9.1 percent—below the December 2019 level.  For 2020 as a whole, average annual jobs were 93,300, or 8.7 percent lower than the annual employment level in 2019.

There were monthly gains in 2021 compared to 2020 except January, February and March that had not taken the huge hit that came in April 2020.  These gains brought the yearly total to 23,100 or 3.4 percent higher than the 2020 level. Unfortunately, the 2021 annual reading was still 70,200, or 6.5 percent under the 2019 annual reading.


From the post-2010 recession year of 2012 through 2016, private employment in the MSA had climbed a modest 9,300, or less than 1 percent in four years. From the 2016 level through the last pre-pandemic year of 2019, private jobs rose 32,300, a three-year gain of 3.1 percent, over three times more than the four-year gain from 2012 to 2016. 

While not comparable to many MSAs with much more robust growth, the period was a marked improvement over the Pittsburgh MSA’s previous four years.  But sadly, this faster growth period was interrupted by the economic impact of the COVID pandemic.  And the 2021 gains have been too anemic to restore the jobs to the 2019 year-end levels, with the December 2021 reading still 58,500 below the December 2019 level.   

Pandemic losses by major sector

As noted, the annual average total private sector jobs in 2021 were still 70,200 below the 2019 level. Of that number, 12,300 were goods-producing and 57,700 were service-providing.  The 58,500-shortfall from the December 2019 posting is comprised of 10,800 goods-producing jobs and 47,700 service-sector employees. 

Table 1

Manufacturing jobs in 2021 as-a-whole remained 7,800 below the 2019 level and in December 2021 were 6,500 lower than December 2019. However, the December 2021 count was barely above the 2020 level and there had been essentially no growth in factory employment since the fall of 2020.  Construction employment fell dramatically, by nearly 50 percent in April 2020 when the lockdown occurred.  But it showed great resilience and by June of 2021 had recovered to the June 2019 level.

Within the services sector, the biggest loser has been leisure and hospitality.  In April 2020, employment fell by 66,500 from April 2019, a drop of 55.9 percent.  By December of 2020, nearly 32,000 jobs had been recovered and by December 2021 another 18,000 had been recovered.  The 2021 annual average employment was 22,700 (18.8 percent) under the 2019 yearly figure.

Comparison to other MSAs

To evaluate the strength of the Pittsburgh MSA’s private employment recovery it is useful to look at seven similarly sized MSAs around the country.  The sample is divided into two groups of four. One northern and north-central and long-time traditionally non-right-to-work (Buffalo, Cleveland, Milwaukee and Pittsburgh); the second, southern and mountain, and long-time right-to-work (Ft. Worth, Nashville, Raleigh and Salt Lake City).

Table 2

The first group, the northern group, turns out to be very weak compared to the second group, the southern group, in terms of long-term employment growth as well as recovery from the losses due to the pandemic in 2020.

Between 2011 and pre-pandemic 2019, private employment in the four-weak MSAs rose an average of 7.4 percent. Remember, 2011 was in the early stages of recovery from the 2008-2010 recession. The strongest MSA in the weak group was Milwaukee at 9.1 percent growth and the weakest was Pittsburgh at 5.7 percent. Meanwhile, in the strong group the average growth from 2011 to 2019 was 30.4 percent, led by Nashville at 37 percent. The slowest gain was posted by Ft. Worth at 23.4 percent. Thus, average employment growth in the strong group was four times faster than the weak group.

The same pattern holds for the recovery of jobs following the huge decline in April 2020.  Extent of recovery is measured in two ways. First, the December 2021 count of private employment is compared to the December 2019 reading. Second, the annual average employment is compared to the annual average for 2019.

As shown in Table 2, the weak group average shortfall in December 2021 compared to 2019 was 5 percent. Pittsburgh was the weakest of the group with jobs still 5.4 percent below the December 2019 level.  The strong group average a 2.2 percent increase compared to December 2019 with all MSAs fully recovered. Salt Lake City led the way, climbing 4.5 percent above the 24-month-earlier level, followed by Raleigh at 2.6 percent above the pre-pandemic December count.

Thus, at the end of 2021 the strong group was a total of 7.2 percent further ahead in employment gains than the weak group that was still significantly below the pre-pandemic job counts. 


The statistics in Table 2 amplify the significant difference in approaches to the job markets and government’s attitude toward control of economic activity and individual liberty among the states—and especially in large cities where control of government has been liberal or very liberal for decades.

In the case of the Pittsburgh MSA, the region is working in an environment of state regulations and development policies that rely too heavily on subsidies in various forms while imposing unnecessary or outdated regulations on the economy and local governments. High costs of fuel and Pennsylvania Turnpike usage driven by state law are not an inducement for prospective businesses to locate in the region and add substantial cost to commuters to work and local truck freight.  Then, too, hefty reliance on subsidies to attract airlines has been largely unsuccessful in adding to the region’s economic growth while sending a bad signal to carriers.      

Lack of regular, periodic reassessments of real estate produces a situation in which inequities mount, forcing appeals that are costly and create uncertainties for homeowners and businesses that could be avoided.  Binding arbitration rules that do not require taking into account the financial capability of local government in union contracts are clearly not in the interest of taxpayers.

Public transit operations in Allegheny County are extremely costly compared to other systems around the country, requiring tremendous subsidies from taxpayers. Then, too, the extraordinarily high education expenditure per student in the City of Pittsburgh and other districts with very poor academic achievement are a substantial force that pushes parents with school-age children out of these school districts.

In short, the MSA and the central city are saddled with a legacy of policies that are not free market supportive. The poor growth compared to other regions points vividly toward the need to make drastic changes in these growth-inhibiting polices.

Short and Long Term Looks at the Pittsburgh Region’s Economy

Summary: Pittsburgh’s seven county metro area’s (MSA) economy has little to boast about for the period since 2000 in terms of job and income gains. There have been some notable bright spots, including Marcellus shale, but overall the picture is one of very slow growth.  And while the latest August figures for payroll employment show some strengthening compared to 2016, the strongest pickup was in leisure and hospitality, a sector that has seen initially reported gains subsequently revised downward significantly. There was also some bounce back in hourly and weekly earnings following a big and unexpected drop in 2016. But as will be seen these latest modestly better numbers cannot mask the longer term trend of very sluggish job and income gains in the region.


The Bureau of Labor Statistics compiles data on two measures of employment. One is based on a monthly survey of households that ascertains information that is used to estimate the number of people in a market area who say they are working or, if not working, if they are looking for a job.  The second is an estimate of the number of employees on payrolls obtained through a survey of businesses in a market area.  Thus, the two measures of employment do not necessarily line up exactly because workers can commute to a market where they do not reside and workers can have more than one job and can therefore be counted more than once in the payroll total. For example, many workers from gas producing states came to work on Marcellus drilling rigs.

The longer term picture

Compared to August 2000 when the MSA labor force stood at 1,207,707 the August 2017 count was at 1,204,546. There was a modest rise in labor force of 31,000 recorded from 2000 through 2012 but that has been completely reversed over the last five years. Meanwhile, the number of area residents employed posted a net decline of 12,290 from 1,154,192 in 2000 to 1,141,899 in 2017.  There was an increase of 14,500 employed residents from 2000 to 2007, but like the labor force pattern, that growth has been completely reversed. In sum, the Pittsburgh MSA has gone 17 years with no net growth in the number of residents working.

Meanwhile, private-sector establishment payroll jobs pushed marginally higher over the 17 years rising from 1,026,800 in August 2000 to 1,062,800 in August 2017. The 36,000 increase represents a 3.5 percent gain—or a compound annual growth rate of a mere 0.2 percent. This anemic rate represents a significant slowing from the 1990 to 2000 decade when jobs grew by one percent per year and boosted private-sector payrolls by 101,000 jobs.

And unfortunately, if history is any guide, the 2017 figure is likely to be revised downward because half of the 11,000 gain in private jobs over the last year has been in the leisure and hospitality sector that has regularly seen big revisions in years past.

In terms of major industry shifts over the last 17 years, goods producing jobs, mostly in manufacturing, are down by 48,000 since 2000 while service producing employment is up 84,000 jobs.

Meanwhile, by comparison U.S. private job growth was 11.5 percent over the 2000 to 2017 period which, like the slowing trend experienced in the MSA, was well below the 21.9 percent rise from 1990 to 2000.

During the 15 years 2000 to 2015, the latest MSA income data available, personal income (adjusted for inflation) growth was also relatively weak at 1.2 percent per year, about half the national real income increase of 2.1 percent per year. Bear in mind that both nationally and regionally, the recession of 2008-2010 produced extended periods in which real incomes remained lower than the 2008 prerecession high points.  The national economy was extremely hard hit by the recession with several states taking six or seven years to recover fully. Overall, the US economy took almost three years to climb back to the income peak of May 2008, reaching it in March 2011.  Pittsburgh MSA income data are not available monthly so a comparative time frame is not possible. But data show that real incomes fell from the 2008 level and remained below that level in 2009 and 2010.

Recent jobs performance

To look at a more recent performance—August 2015 to August 2017—payroll employment and real weekly earnings of private-sector employees are reviewed.

Over the two year period, the private-sector job count rose 10,600 to stand at 1.0628 million, a mere one percent pick up in two years.  The long slide in goods-producing jobs was still in evidence the past two years as employment fell by 9,300 to stand at 149,500 in August 2017.  Private service jobs, meanwhile, rose by 20,000 to reach 913,300 and offset the ongoing goods producing slide.

Of the 20,000 increase in service employment, 7,500 were in leisure and hospitality payroll gains—a sector that makes up about one eighth of service jobs and one tenth of all private sector employment.  Food services and drinking places climbed 5,800 representing the bulk of the overall sector rise.

The 7,500 jump in leisure and hospitality is a gain of 6.1 percent. However, there are two problems with the latest jobs number. First, it is likely to be revised downward. And second, jobs in the sector are low wage with very low weekly earnings because of the average 25-hour work week. Thus, these jobs are weak contributors to income and output compared to manufacturing or professional service employment.

Health care and social assistance jobs climbed from 189,400 in 2015 to 195,200 in 2017, an increase of 5,800.  Social assistance employment notched higher from 32,000 to 35,200 or 3,200 jobs (a 10 percent gain) meaning this category that represents only one sixth of the sector total accounted for well over half of the sector job gain.  Health care accounted for only 2,600 new jobs.

Somewhat surprisingly, nursing home jobs decreased slightly. Modest increases in employment in doctors’ offices, hospitals and ambulatory services combined to produce the rest of the health care growth.

Substantial growth was registered in the professional and business services sector which saw a 4,900 gain in employment, a 2.7 percent rise over the two years. This sector is among the highest paid service jobs and is therefore a principal contributor to earnings growth in the MSA. The financial services category (1,700 jobs) and colleges and universities (1,400) were the only other service sectors to post meaningful gains. Employment in all the other major service categories including retail, wholesale, transportation and utilities, and information was flat to slightly lower.

Earnings changes

Finally, a review of the growth in hourly and weekly earnings since 2007 (the earliest MSA data available) and since 2015. The Labor Department provides data for all private workers including data for average hours worked per week, average hourly earnings and average weekly earnings. Hourly earnings and weekly earnings were adjusted for inflation using the national Consumer Price Index.

Average hours worked per week in the MSA have been on a slowly declining trend since 2007, falling from 34.5 to 33.7 hours in 2017, a drop of 2.3 percent. Average hourly earnings rose from $19.86 in 2007 to $25.10 in 2017 (2.4 percent per year) resulting in an increase in average weekly earnings from $685.17 to $845.57, a gain of 23.4 percent (2.1 percent per year). However after adjusting for price increases, weekly earnings were up a mere 4.5 percent over the ten years, an annual growth rate of just 0.44 percent.

Over the past two years, August 2015 to August 2017, weekly earnings are up 2.7 percent or 1.35 percent per year. With prices higher by 3.0 percent, that means MSA real weekly private sector earnings are basically flat since 2015.

These very slow income growth rates for the two periods reflect in large measure the ongoing shift away from goods producing jobs to lower paying service sector employment, especially in the categories of leisure and hospitality and social assistance.

Summing up: Notwithstanding a few positive developments including Marcellus shale, the seven county Pittsburgh MSA has seen a 17-year period since 2000 in which there has been no net growth in the labor force or number of residents working.  Payroll employment managed to register a paltry 3.5 percent increase over the 2000 to 2017 period, less than a third of  U.S. gains.

Meanwhile, real personal income for all residents from all sources including dividends, rent, interest and transfer payments edged upward at a 1.2 percent annual rate between 2000 and 2015, half the U.S. rate. And since 2007, average weekly earnings for private-sector employees rose a skimpy 0.4 percent rate since 2007.

A Jobs Tale of Two Pennsylvania Cities

To say that the employment picture between 2001 and 2015 has been interesting and volatile would be a woeful understatement. Nonetheless it is true whether one is referring to jobs growth in the state, nation, or the Philadelphia and Pittsburgh metropolitan statistical areas.


U.S. private sector jobs climbed eight percent (just under 9 million) between 2001 and 2015, a rate of well below one percent per year.  Gains were mediocre through 2007 and after the recession of 2008-2010 it took almost seven years for jobs to climb back to the 2007 figure. There was some acceleration in employment expansion in 2014 and 2015. Meanwhile, in Pennsylvania, private employment managed a pickup of only 3.6 percent (179,000 jobs for a paltry annual average gain of 12,800) over the 2001 to 2015 period.  The growth was evenly split at 1.8 percent each in the periods 2001 to 2008 and 2008 to 2015.  And, as was the case nationally, it took almost seven years for the state to see jobs return to their 2007 high point. There was a modest rebound from the recession but growth has averaged only one percent per year since the recession.


These figures will serve as a backdrop for the examination of the employment story in Pittsburgh and Philadelphia. For the purpose of this Brief, we focus on the five county area (Bucks, Chester, Delaware, Montgomery and Philadelphia) comprising the Pennsylvania part of the Philadelphia MSA, which also includes counties from neighboring states.  For the Philadelphia MSA, private employment grew a mere 3.4 percent over the 2001 to 2015 period.  There was very little growth (1.1 percent) from 2001 to 2008 and a slight pick up to 2.2 percent for 2008 to 2015.  After a post-recession bounce, jobs rose at a moderate 1.4 percent rate in the 2012 to 2015 period.


In the Pittsburgh MSA the private jobs figures have been dismal for much of the 2001 to 2015 period. From 2001 to 2008, employment was down slightly (4,000) despite small gains in 2006 and 2007. Between 2008 and 2015, private sector jobs rose by 2.2 percent thanks to a sharp rebound in 2011 and 2012 from the recession’s low point of 2009, due in large part to the boom in Marcellus Shale gas drilling and the impacts on firms supplying the activity. However, since 2012 the expansion of private sector employment has slowed to a crawl with only 8,400 jobs added from 2012 through 2015—a growth rate of less than 0.3 percent per year.


A comparison of the performance of key industry sectors in Philadelphia and Pittsburgh since the end of the recession follows.


As mentioned above, when the recession that started in 2008 finally loosened its grip on the national economy, the Pittsburgh MSA experienced a quick rebound in the immediate years following, but since that quick burst, job growth has slowed dramatically.  This slowing growth is best exemplified through the data on private jobs.  The table below illustrates.

total jobs


The table shows employment growth over the period 2010 (the year the recovery began) through 2015 at 4.8 percent for the Pittsburgh MSA.  However, for the Philadelphia MSA, we see a different picture as private jobs grew at a slightly faster pace (6.3%).  But unlike the Pittsburgh MSA, the Philadelphia MSA was better able to sustain that growth.  From 2012 to 2015, private jobs grew at a rate of 4.1 percent—five times faster than the Pittsburgh MSA (0.8%).  For the  2014-2015 time frame, the annual average number of jobs increased by nearly one and a half percent in the Philadelphia area versus just a third of a percent in the Pittsburgh area.


Pittsburgh area leaders are quick to point out that the region is strong in education and health care jobs.  But how did growth in this sector stack up to that of the Philadelphia area?  The following table shows the results.

education jobs


For the period of 2010 to 2015 the Pittsburgh MSA experienced 1.6 percent job growth in this sector.  However, the Philadelphia MSA grew by more than four times as much (6.6%).  This pattern continued over the two sub periods as the Pittsburgh MSA experienced employment declines in this sector while the Philadelphia MSA had growth rates of 3.9 percent (2012-2015) and 1.8 percent (2014-2015).  For the Pittsburgh MSA, weakness in this sector stems from the educational services subsector which experienced significant declines in each period while health care jobs were basically flat.


As we have documented in earlier Policy Briefs, one of Pittsburgh’s top performing sectors in terms of job gains has been leisure and hospitality.  While we have for some time argued—and continue to believe—that this is not a sector on which to base a strong economy due to typically low paying wages, it has been a primary source of employment strength for the area.  The following table shows the growth in this sector.

Leisure jobs


From 2010-2015 leisure and hospitality employment grew by nearly eight percent in the Pittsburgh MSA.  While this seems impressive, in the Philadelphia MSA, jobs in this sector expanded by 13.5 percent.  During the sub periods (2012-2015 and 2014-2015), the two regions posted similar rates of increase. Obviously, the Philadelphia region enjoyed much faster gains than Pittsburgh in the years 2010 to 2012. It makes sense that the Philadelphia area would have a strong leisure and hospitality sector because of the numerous famous historical attractions there.  However, we continue to be puzzled by the strong growth in Pittsburgh’s leisure and hospitality sector because the data do not provide information regarding the types of businesses creating the expansion in payrolls.


The one industry area where the Pittsburgh MSA has had the upper hand on its cross-state rival is in the professional and business services sector, specifically the professional, scientific, and technical services subsector.  The following table shows the growth in this subsector.

professional jobs


From 2010 to 2015 this subsector in the Pittsburgh MSA had a huge surge in jobs, advancing by more than nineteen percent compared to Philadelphia’s very good 8.6 percent.  In the 2012-2015 and 2014-2015 sub periods this growth remained strong in both regions, but far more robust in Pittsburgh than in Philadelphia.


Unfortunately, manufacturing has been in decline across the state for many years, including in the state’s largest cities. The table below shows the loss of employment in this sector for the two regions.

manufacturing jobs


The table shows that the Philadelphia MSA had a significant loss of jobs in the 2010-2015 period, while there was a very small rise in the Pittsburgh area, most likely due to the relationship with the Marcellus Shale drilling activity.  Of course, that growth must have occurred in the 2010 to 2012 period as jobs are down since 2012. Indeed, since 2012 manufacturing in the Pittsburgh area has shed jobs at a slightly higher rate than Philadelphia.


In sum, after a robust upturn following the 2008 to 2010 recession, the Pittsburgh MSA job count has slowed over the last three years despite strong gains in leisure and hospitality and professional and technical services. To put this in perspective we compared the Pittsburgh MSA growth rates for private jobs, as well as some selected industry sectors, to the gains in the five Pennsylvania counties that are included in the Philadelphia MSA.  Somewhat surprisingly, we find that overall Philadelphia employment has grown faster than Pittsburgh since 2001, albeit still at a paltry 3.4 percent rise over the fourteen year period while Pittsburgh managed only a 1.8 percent advance. Moreover, Philadelphia has maintained decent growth over the last three years while Pittsburgh has definitely cooled off dramatically.


Keep in mind that the Philadelphia MSA does not have a mining and logging sector, as does the Pittsburgh MSA, which has reaped the rewards of drilling in the Marcellus Shale formation and some attendant strong employment gains in the 2010 to 2012 period. But that sector’s employment has fallen sharply and with it a lot of the area’s previous strength.


Suffice it to say that neither metro area, nor the state as a whole, compares favorably to the national performance and appear even weaker when compared to the strong growth in many states.  And unfortunately, they are not likely to show much improvement compared to states with strong performance as long as the Commonwealth labors under the heavy hand of regulations, the absence of a right to work, high corporate taxes and a generally unfriendly business climate.