Despite Lower Official Unemployment, Jobs Still In Short Supply In PA

Manufacturing Crisis Continues: Employment Down 2,100 Jobs in Last Month

Harrisburg – Too few jobs and too few good jobs continue to be the economic story in Pennsylvania, despite a fall in the Pennsylvania unemployment rate to 5.2 percent, according KRC analysis of federal job data released today.

While the unemployment rate in Pennsylvania has fallen from 5.9 percent a year ago, a careful analysis of the new data shows the decline is mostly due to a sharp drop in the labor force. Almost exactly 100,000 fewer Pennsylvanians are in the labor force than in November 2002. If the labor force had not shrunk, state unemployment today would be 6.7 percent.

Pennsylvania job growth in the two full years since recovery from the last recession began has been negative. Since November 2001, 9,500 jobs have been lost and job growth has trailed working-age population growth in the state by 1.2 percentage points.

The data suggest that good jobs are in short supply, in part, because of the continuing loss of middle-class manufacturing jobs. Pennsylvania manufacturing employs 71,900 fewer people now than it did at the start of the recovery.

“The average manufacturing job pays $43,000 in Pennsylvania – usually with good benefits,” added Herzenberg, “many displaced workers can only find employment in industries like security services, call centers and retail trade where average annual pay ranges between $16,000 and $22,000 per year.”

Manufacturing job loss is particularly concentrated in the one third of Pennsylvania counties, many of them rural, in which manufacturing still accounts for between one and two out of every five jobs.

Misguided federal policies have been a central reason for poor job performance, according to Keystone. Based on Bush Administration projections, 47,600 Pennsylvania jobs were supposed to have been created as a result of the President’s “Jobs and Growth” tax-cut initiatives. During that period, however, Pennsylvania has actually lost 5,500 jobs. A big reason has been that tax cuts targeted to the rich stimulate the economy less than tax cuts for working families or direct government spending.

Ill-conceived federal trade policies bear a special responsibility for manufacturing’s decline. As KRC reported yesterday (see Job Losses Due to Trade Since NAFTA Deepen Pennsylvania’s Manufacturing Crisis on line at www.keystoneresearch.org), up to 150,000 Pennsylvania manufacturing jobs have been lost since 1993 due to the rising U.S. trade deficit. Trade with Mexico and Canada alone accounted for the loss of 31,000 Pennsylvania manufacturing jobs.

The Bush Administration this week advocated another round of free trade at the expense of America’s heartland via the proposed Central America Free Trade Agreement (CAFTA). Stephen Herzenberg, KRC Executive Director, said that “The Bush Administration has not yet explained why more free trade – with no attention to support for democracy and development, environmental and labor standards – will do anything but accelerate a race to the bottom for America’s working families. With productivity at unprecedented levels, we should be talking about how to translate economic strength into better lives, stronger communities, a cleaner planet. But outdated and unimaginative policies block our path to a better future.”

The latest Pennsylvania employment, unemployment, and job creation numbers are available by at the Keystone Research Center's "Economic Snapshot" Web page at www.keystoneresearch.org/snapshot. National data are available from the Job Watch web site at www.jobwatch.org.

CURRENT FACTS ON JOBS IN PENNSYLVANIA

Bush 'Jobs and Growth' Plan Disappoints.

From June 2003 to November 2003, 47,600 jobs were supposed to have been created in Pennsylvania under President Bush's so-called 'Jobs and Growth' tax cut. In fact, since the tax cut was projected to start creating jobs, Pennsylvania has lost 5,500 jobs.

Pennsylvania has fewer jobs than when the recession began.

The state of Pennsylvania had 79,200 fewer jobs in November 2003 than in March 2001 when the recession officially began--a decline of 1.4%.

Pennsylvania has fewer jobs than when the recession ended.

The state of Pennsylvania had 9,500 fewer jobs in October 2003 than in November 2001 when the recession officially ended--a decline of 0.2%.

Pennsylvania has a higher unemployment rate than when the recession began.

The state of Pennsylvania had an unemployment rate of 5.2% in November 2003, up from 4.3% in March 2001, when the recession officially began.

Pennsylvania has fewer jobs than in the beginning of 2001.

The state of Pennsylvania had 78,100 fewer jobs in November 2003 than in January 2001.

Pennsylvania has a higher unemployment rate than in the beginning of 2001.

The state of Pennsylvania had an unemployment rate of 5.2% in November 2003, up from 4.2% in January 2001.

Job Growth has not kept up with working-age population growth in Pennsylvania.

Job Growth since the recession began has been approximately 2.8 percentage points less than working-age population growth. If job growth since the recession began had just kept up with working-age population growth, Pennsylvania would have approximately 160,200 more jobs

Job Growth since the recession ended has been approximately 1.2 percentage points less than working age population growth. If job growth since the recession ended had just kept up with working-age population growth, Pennsylvania would have approximately 70,400 more jobs

Job Growth since January 2001 has been approximately 2.9 percentage points less than working age population growth. If job growth since January 2001 had just kept up with working-age population growth, Pennsylvania would have approximately 164,100 more jobs.