The May employment data give a mixed picture. The unemployment rate and the number of people unemployed are high, but the labor force set a record for size in May and the rate of unemployment in all other benchmark regions was higher in May than it was in Pittsburgh.
Updated data on ozone and fine particulates are now available. The most notable change is in the peak PM2.5 readings for the years 2007 and 2008. They are just half of what they were in 2004-06, but still very high by benchmark and national standards.
The May jobs numbers are now on the site along with an assessment by Harold Miller in the Region’s Forum on the implications of the negative data. Every jobs category was down but one, Education and Health Services.
Three indicators on airport traffic have been updated on the site. They confirm a trend that took hold six years ago; declines in departures and markets served continue. We also publish monthly data on barge traffic, a good barometer of the coal business. The report for the first five months of 2009 is quite negative.
Although everyone has been looking for some good economic news, there is, unfortunately, no sign that the recession is abating locally. Indeed, May was the worst month so far in terms of job losses in the Pittsburgh Region. Between May 2008 and May 2009, the Pittsburgh metro area lost 33,600 jobs, a 2.9% drop. For the second month in a row, the region has fewer jobs than it did in 1999, i.e., an entire decade’s economic growth has been lost.
Don’t be confused if you hear reports saying that the region added jobs in May. It’s true that there were 5,700 more jobs here in May than there were in April. But there are always more jobs in May than there are in April due to seasonal hiring patterns. The key fact that is that the increase in jobs between April and May this year was smaller than in any year since 1995, and as a result of that and the losses in previous months, there are 33,600 fewer jobs in May this year than there were in May of 2008.
We’ve still lost fewer jobs than most major regions in the country, but we’ve been slowly slipping behind some regions that were previously doing worse than we were. As of May, among our benchmark regions, Boston and Kansas City had lost fewer jobs on a percentage basis in the past year than the Pittsburgh Region did.
The most troubling news continues to be the significant and accelerating loss of manufacturing jobs in the region. In just twelve months, the Pittsburgh Region has lost over 9,000 manufacturing jobs – 1 out of every 11 manufacturing jobs that were here last year. Manufacturing jobs are among the highest paid jobs in the region and typically have some of the best health and retirement benefits, so losing a manufacturing job has a particularly large negative impact on the regional economy.
Up through the beginning of the year, Pittsburgh’s manufacturing sector was one of our strengths – even though we were losing manufacturing jobs, we were losing them at the 5th smallest rate among the 40 largest regions. But in May, Pittsburgh had the 7th highest rate of manufacturing job loss among our benchmark regions. The manufacturing sector is now the biggest contributor to job losses in the region.
The second biggest contributor to job losses continues to be the leisure and hospitality industry. Over 7,000 jobs have been lost in that sector over the past year. This is not only a large jobs loss relative to other sectors here, it's the 2nd biggest percentage loss in that sector among our benchmark regions.
Construction is the fourth largest contributor to local job losses – we have 4,900 fewer construction jobs in May than a year ago – but unlike in the manufacturing sector and the leisure and hospitality sector, construction workers have fared better here than in most regions. Although our 8.2% loss of construction jobs is high, it's only half as big as the losses of 15% in Milwaukee, 16% in Boston, and 19% in Indianapolis.
Health care and higher education still have more jobs than last year, but even there, the rate of growth has slowed significantly from where it was last year, particularly in higher education, likely reflecting the impacts of smaller endowment earnings.
If you saw the recent news stories about a Brookings Institution report saying that Pittsburgh’s economy ranked 18th best out of 100 regions, it’s important to recognize that the data used in that report were old news – they only measured employment and unemployment changes through March, whereas Pittsburgh’s job losses have accelerated rapidly in April and May. Also, little noticed was the fact that the Brookings report also ranked the region only 59th (42nd worst) over the past year in the change in gross metropolitan product, i.e., the value of goods and services produced in the region. That is probably a reflection of the accelerating job losses in high-wage sectors such as manufacturing that began here early in 2009.
It’s not likely that Pittsburgh’s economy will experience any significant turnaround before the U.S. economy recovers, and national job losses continued to worsen in May. Moreover, even when the U.S. economy turns around, Pittsburgh may lag behind as it has in past recessions.
New data on employment, unemployment and labor force are available through April. The labor force is continuing to grow in number, up for the 10th month in a row, and with it the rolls of the unemployed.
The latest data for major crime in the region are now available and the story is a familiar one: The Pittsburgh region's rates for murder, burglary and robbery are low by benchmark standards. That is not the case, however, for the core city of Pittsburgh, when it comes to murder the rate in the most recent year, 2008, was a record for the decade.
Unfortunately, the latest regional job numbers released just before the start of the Memorial Day Weekend aren't anything to celebrate. The Pittsburgh Region lost nearly 28,000 jobs between April 2008 and April 2009 (1 out of every 40 jobs in the region). The most depressing news is that the total number of jobs in the region has now fallen below 1999 levels for the first time since 2003; in other words, all of the net job gains the region has made in the past decade have been lost.
The rate of job loss here is still lower than the U.S. as a whole and lower than all but one of our benchmark regions. However, our rate of job loss increased significantly in April; if that keeps up, we will stop looking so good relative to other regions.
In particular, one of the reasons our economy had been doing well relative to others was that we had been losing manufacturing jobs at a much lower rate. Unfortunately, that is no longer true; in April, our rate of manufacturing job loss was higher than 7 of our benchmark regions.
Our health care and higher education sectors continue to be the only significant net job generators. In addition to manufacturing, our region is being hurt by large job losses in the leisure and hospitality sector relative to other regions (particularly among arts and entertainment organizations) and large job losses in professional and business services and construction (although those losses are still lower in percentage terms than most regions).
Since the U.S. as a whole has now been losing jobs for a full year, we're lucky that we've only been losing jobs for seven months and at much lower rates. But since the U.S. is continuing to lose jobs, it seems likely that things will get worse here before they get better.
New annual data about single-family home sales through the 1st quarter of 2009 are available. There are also separate indicators on the rate that home prices appreciated in value in 2008 (ever-so-slightly) over 2007, as well as appreciation rates for the past 5, 10 and 20 years.
New data on the quality of Pittsburgh roads and the additional costs per year to a car owner as a result of those road conditions are posted. The good roads are up a percentage point and the bad roads are down a percentage point. That resulted in $34 less to a Pittsburgh car owner in additional car expenses in 2007 compared to 2006.
There are also barge traffic numbers posted through April; they remain weak year-over-year.
In December 2007, Pittsburgh Today introduced a new home page design that featured as a centerpiece images from our 22-county region. Jeff Lantz of Springdale has been one of our community contributors from the very first week. In recognition of the excellence of his work, for the next two weeks we will be running five photos of his that poignantly capture the tragic April 4 events that cut short the lives of three Pittsburgh police officers.
(Jeff Lantz at home with his dog)
Lantz heard the news report and hopped in his car to record the events in Stanton Heights. On his own initiative, he stuck with story through the week until the officers were laid to rest following a moving service on the campus of the University of Pittsburgh. You will notice three other Lantz photos on the site that were part of our most recent sequence which will continue until mid-June. You may also see more of Lantz’s photography at www.flickr.com/fuzzzy.
Thank you all very much,
Region Indicators Organizing Committee
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