In early 2008, the U.S. economy was hitting a peak in terms of private sector employment prior to the onset of a slowdown followed by very severe recession beginning in the fall. The same basic pattern of employment held in Pennsylvania. In the Pittsburgh metro area, private employment gains continued through midyear before the effects of the subprime mortgage induced financial crisis began to lower the region’s job count.
Interestingly, the percentage jobs losses during the recession was much worse in the nation as a whole than either Pennsylvania or the Pittsburgh area. From pre-recession peak to the low point, private sector employment in the U.S. fell 7.6 percent—a stunning 8.7 million jobs. In Pennsylvania the peak to trough jobs loss was a comparatively mild but still hefty 5 percent. The Pittsburgh region fared best suffering a private job loss of only 4.1 percent.
Moreover, the recovery in Pittsburgh was strong and by mid-2012, private jobs were already fully recovered from the recession and setting new all-time records, surpassing the previous highs recorded in 2001. At the same time, the recovery in the U.S. has been relatively weak in view of the fact that usually sharp downturns are followed sharp upturns. Indeed, it wasn’t until March of 2014 that private employment was able to climb back above the January 2008 reading. Pennsylvania has followed suit and has yet to fully recover employment back to the January 2008 reading through March of 2014 data, although the gap had fallen to 5,500 jobs—barely statistically significant.
By way of comparison, it is worth noting that over the six years from January 2008 to January 2014 private employment in Texas was up by 736,000 jobs. This is not to say that Texas was spared the recession—employment fell by 4.6 percent from the pre-recession peak to the low point two years later in 2010. The difference between Texas and the U.S. has been the amazing 1.14 million jobs—13.6 percent growth —added since January 2010. U.S. jobs were up only 7.9 percent, PA jobs were up 4.8 and Pittsburgh’s employment grew 4.9 percent over the same four year period.
It is noteworthy as well that in both Pennsylvania and the U.S., the number of people reporting they are employed has still not returned to their pre-recession level. In the Pittsburgh metro area the persons working count basically leveled off near the 2008 posting by late 2013.
It is also notable that the 2010 employment level in the U.S. fell below its six year earlier reading. The first time that had happened in the post WWII era. It was also below its six year earlier posting in 2011, 2012, and 2013. Such prolonged weakness points to some serious policy problems and structural defects. Moreover, the number of persons of non-institutionalized working age not in the work force has risen by 13 million, which is 8.4 million more than it would have grown if the labor force participation rate had held at the 2008 level.
