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Economy & Business

Study: PA Job Growth Still 'Sluggish'

Pennsylvania ranks 42nd among all states in job growth over the last 12 months according to the left-leaning Keystone Research Center.  However, Pennsylvania’s unemployment rate for May was 5.6 percent,which was below the national rate of 6.3 percent, and better than 30 other states.

Stephen Herzenberg, the center’s executive director, said job growth in the commonwealth has been poor the last few years, but he acknowledged that the private sector created 15,600 jobs in the first four months of this year.

“We’re probably going to do better than last year in 2014, but the overall job growth is still sluggish, and the declines of public sector employment continuing to be a drag on private sector job growth and the overall recovery that remains a theme,” said Herzenberg.

According to Pennsylvania Department of Labor and Industry, more than 10,000 public sector jobs—education and government—have been trimmed over the last 12 months. 

Herzenberg attributes some of that “sluggishness” to state policies that have cut spending in the last four years.  “When the private sector economy is not strong enough yet, when private consumers aren’t able to drive job growth because they don’t have jobs or their wages aren’t going up, that’s when you need the government to make investments in the future and to help drive the economy out of the doldrums.”

Gov. Ed Rendell’s final budget (FY 2010-11) totaled $29 billion compared to Gov. Tom Corbett’s current budget (FY 2013-14) of $28.3 billion.  The FY 10-11 budget was bolstered by $2.7 bill in temporary federal stimulus funds.

Herzenberg noted that the private sector growth so far in 2014 has happened despite a loss of 2,400 manufacturing jobs.  “Nationally and in Pennsylvania there’s been a bit of a stagnation again in manufacturing jobs.  So in some degree it’s back to parts of the service sector like health care that are doing a bit better.”

But the state has not recovered all the jobs lost since the recession began.   “We actually have fewer jobs, 44,000 fewer jobs than December 2007,” Herzenberg said.  “We’re 250,000 jobs in the hole because the population keeps growing and you need to create jobs for the new folks that enter the labor force.”