Debunking Fallacy Filled Economic Analysis

How to speed job growth in Pennsylvania?  According to the latest offering from the Keystone Research Center (KRC), the Commonwealth and local tax levying bodies should raise taxes and hire more employees. 


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Has Allegheny County’s Population Loss Ended?

Has the population decline in Allegheny County that dates back to 1960 finally ended? The latest Census figures show the rate of population loss since 2000 appears to have slowed to a halt-at least temporarily. The question is: has the County turned the corner and is it now poised to begin reversing the decades-long pattern of population loss, or is it more of a momentary pause in losses stemming from the effects of the deep national recession? 

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Another Misleading Analysis of PA Jobs Turns Up

govt state

In a February 8, 2011 report, the Keystone Research Center credits Pennsylvania’s recent comparatively good jobs performance on all the money spent in the last few years to promote green energy, workforce skills, and education.  At the same time, the report blames New Jersey’s relative weakness on Governor Christie’s spending cuts and urges Pennsylvania’s new Governor to put away his budget paring knife.  This Policy Brief reaches the opposite conclusion.  



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Brookings Tells Us Nothing New About Pittsburgh Economy

Since 2008, the Allegheny Institute has commented many times on the slow arriving recession and its relatively moderate negative impact on the region’s economy.  With no housing or general real estate boom there was no bust in the region-a major factor in the severity of the downturn in many fast growing cities such as Las Vegas, Phoenix and states such as Florida.


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Has Recession Loosened Its Grip on the Pittsburgh Region?


Is the recession loosening its grip on the Pittsburgh area?  According to the latest payroll employment data for August, the answer may be “yes”.  August marked the third straight month that total private jobs showed a year-over-year increase.  The August 2010 figure of just over one million jobs bests the August 2009 figure of 994,300 by more than one-half percent.  This follows on the heels of small year to year increases in June and July. While relatively miniscule, these gains represent the first positive upswing in the year-over-year payroll employment since October 2008. 


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Labor Day in the ‘Burgh Will Find No Joy in the Employment Situation

Compounding the litany of financial difficulties confronting the City of Pittsburgh the latest jobless figures (July 2010) show a recession-high unemployment rate in the City’s labor force of 9.1 percent-a level not experienced in well over a decade.  The unemployment rate has almost doubled since the July 2007 reading of 4.7 percent.


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Recession Continued to Grip Region Through January

According to some analysts the recession is over. The Bureau of Economic Analysis has reported that real gross domestic product increased in both the third and fourth quarters of 2009, suggesting the long economic slide is coming to an end. While welcome news, many folks are still feeling the effects of the recession.  For January, the national unemployment rate was a seasonally-adjusted 9.7 percent; Pennsylvania’s rate was lower at 8.8 percent and Pittsburgh region’s rate stood at 8.1 percent-up from 7.9 percent in December.  The unemployment rates underscore just how the recession, while technically over, continues for large numbers of people (100,000 unemployed in the region as of January). 



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Recession Retains its Grip on Pittsburgh

While many economists and politicians are claiming the recession that has been gripping the nation is starting to lessen, its hold on the Pittsburgh area remains firm. The latest jobs numbers for July 2009 bear this out. When comparing the year-over-year jobs totals for July 2008 and July 2009, the region lost 30,800 total private jobs, slightly better than the June-over-June totals of -30,900. The Pittsburgh region’s loss to total private jobs (-3 percent) for July are much better than the national average (-5 percent), but as we’ve pointed out countless times before, the region never "boomed", so it really couldn’t "bust".

Nearly all major sectors experienced year-over-year job losses-the lone exception being, once again, education and health services. But even there, the job gains were not as pronounced as they had been. The sector’s July year-over-year gains were only 2,800 jobs whereas the year-over-year gains for May (3,200), June (3,400) were slightly higher. As we pointed out in a previous Policy Brief (Vol. 9, No. 41), growth to this sector, particularly the social assistance sub-sector which counts for most of the growth, is actually as sign of weakness as these jobs are often low-paying and rely on public dollars for their existence.

The manufacturing sector continues to be the hardest hit sector as it lost 10,800 jobs or nearly 11 percent of its employment count. Construction jobs also continue to post losses (-3,400) as did the retail sector (-3,300), the professional and business services sector (-5,500) and the leisure and hospitality sector (-5,000). This latest employment report did not have much to cheer about for many of the sectors of Pittsburgh’s economy.

The recession’s grip on Pittsburgh will not begin to abate until it also loosens on the country as a whole. However, steps can be taken to expedite, rather than prolong, the process. Efforts to raise taxes at the state and local levels must be resisted. The Governor’s plan to increase taxes, either the sales or income tax, will have a markedly negative effect on the local economy. Instead, state and local officials need to cut onerous government spending as well as taxes. They also need to tackle burdensome regulations, such as mandated wages, that are stifling business growth. Only when these measures are enacted will the Pittsburgh economy reverse the trend of job losses and possibly experience an economic boom.

Pittsburgh: Recession Proof?

Early on in this recession that has been gripping the nation, Pittsburgh had gained national recognition as a city that is seemingly recession proof. The basis for this thought was that since the Pittsburgh region never "boomed", it couldn’t "bust". Well over the last three months, the recession has not only hit the Pittsburgh area, it has struck hard.

The latest employment figures from the Bureau of Labor Statistics show that from May 2008 to May 2009 the Pittsburgh Metropolitan Statistical Area (MSA) lost 33,300 total private jobs-the largest such year-over-year loss in at least two decades and the third straight month that claim can be made. In fact the number of May 2009 total private jobs in the area are at the lowest May level since 1998.

While it is impossible to say whether or not this represents the bottom of the recession and that things will start to improve, the area’s employers are not being helped by elected officials. With City Council and the Mayor discussing tax increases on hospitals and universities and the Governor wanting to halt the phase out of the capital stock and franchise tax and increasing the personal income tax, the future business climate looks ominous. The mentality of businesses being cash cows to be milked at the government’s pleasure will only harm any efforts to climb out of the recession.

Of course this is why the area never "boomed" in the first place.