Ralph R. Reiland: Pa.'s unflattering economic snapshot

November 8, 2015



RALPH R. REILAND: Pa.’s unflattering economic snapshot

Compared to the rest of the country, Pennsylvania’s economy is a flop.

The “Economic Snapshot: Pennsylvania” section of an October 2015 report by the U.S. Joint Economic Committee on employment, poverty and job growth, utilizing data from the Bureau of Labor Statistics through Oct. 20, highlights the following economic results and comparative performances for Pennsylvania:

• Since February 2010, the national low point for private-sector employment, Pennsylvania businesses have added 333,600 jobs (an increase of 7 percent). Nationally, substantially outperforming Pennsylvania, private payrolls have increased by 12.3 percent over the same time period.

• In September 2015, private-sector employment in Pennsylvania dropped by 5,200 jobs. Over the past year, Pennsylvania businesses have added 43,900 jobs -- a decline compared with an increase of 61,400 jobs over the 12 months through September 2014.

• The unemployment rate in Pennsylvania in September 2015 was 5.3 percent, higher than the 5.1 percent national unemployment rate in the United States at the same time.

• There were 338,700 Pennsylvania residents unemployed in September 2015.

• Real gross domestic product (GDP) in Pennsylvania grew by 1.8 percent in 2014, below the national average growth rate of 2.2 percent during the same time period.

• Since 2009, annual Pennsylvania GDP growth has averaged 1.5 percent, below the national average annual growth rate of 1.9 percent.

• Pennsylvania’s poverty rate in 2007 (pre-recession) was 10.4 percent, compared to 12.5 percent in 2014.

In short, Pennsylvania is lagging behind the nation in its rate of private-sector job growth; the number of new jobs being added by Pennsylvania’s businesses is lower in 2015 than 2014; Pennsylvania’s poverty rate increased by 20 percent from 2007 to 2015; Pennsylvania’s rates of growth for income and output of goods and services (GDP) since 2009 are lower than the national growth rates for income and GDP.

Additionally, the Keystone Research Center reported in October 2014 that Pennsylvania ranked 50th in job growth since January 2011: “Pennsylvania’s rank for percentage job growth since January 2011 has fallen to last place among states, based on employment data for September 2014 released this morning by the Bureau of Labor Statistics.”

The same subpar results have been apparent in the economic condition and job growth performance of Pennsylvania’s major cities, as reported in The Philadelphia Inquirer in April 2014 by Joseph DiStefano. “Pennsylvania ranks among the weakest states and its major cities, Philadelphia and Pittsburgh, ranked near the bottom for job growth in 2013, reports professor Lee McPheters of the W.P. Carey School of Business at Arizona State University in an annual study,” reported DiStefano “Among cities ranked in the survey, Pittsburgh ranked dead last, and Philadelphia was second-to-last. Among states, Pennsylvania ranked third from the last, with only Arkansas and West Virginia adding fewer jobs, proportionately.”

A headline on a report in the July 20, 2015 issue of Forbes summed up Gov. Tom Wolf’s flawed solution to these economic failures: “Pa Democrat Gov. Wolf’s Largest Tax Increase In History Rejected By Both Parties In The House 193-0.”

Ralph R. Reiland is an associate professor of economics and the B. Kenneth Simon professor of free enterprise at Robert Morris University in Pittsburgh. Email him at rrreiland@aol.com