The Tribune Democrat, Johnstown, PA

August 1, 2013

Area economy still sluggish

Bill Findley
For The Tribune-Democrat

JOHNSTOWN — Halfway through 2013, the performance of the local economy continues to be disappointing.

What’s a lot more disappointing is the first half comparison of both job and unemployment trends from 2007 through the current period that confirms that local economic conditions are taking a long time getting back to normal. Throughout this time frame that includes the recession (2007-09) and subsequent recovery, this area, like most others, witnessed job reductions along with high rates of unemployment that have been slow to recede. This trend has led many to conclude that significant economic weakness remains in place.

None of the major industry groups have recovered all of the jobs lost through this period. The peak number of jobs in the first half of 2008 averaged 62,000, which is 2500 above the current level of 59,500.

The job level dropped sharply here in 2009 as the recession deepened in its latter stages here and has struggled to be on a positive track since. Job changes throughout this period are obviously impacted by recovery trends to include national developments that have played a part as well. The absence of a typical growth pattern usually associated with recovery periods would have established a more normal recovery pace. In addition, general concerns about the overall sustainability of improvement, along with diminished employer confidence, could be cited, as well as the uneven recovery progress among various industry groups. Also, we cannot lose sight of significant reductions across the employer community associated with impending job transfers, plant relocations and substantial permanent losses involving both state and federal facilities.

In comparison to a year ago, on average the number of jobs advanced by only 100. A notable aspect of the changes during this time period was the very modest differences in the job levels among most of the key industry sectors. Specifically, manufacturers lost an average of 100 jobs, while trade advanced by 200 along with business services (100) and leisure and hospitality (300). The most significant change occurred in total government (i.e. the sum of state, local and federal) where employment has decreased by 500.

The unemployment numbers that represent the other key factor in this first-half assessment have not fared much better. Throughout this comparative time period, the rate has moved upward from a respectable level of 5.3 percent in 2007 to a high of 9.7 in 2010, to a current level of 9.3 percent.

Unemployment is highly dependent on the level of economic activity that in part explains the consistency of the comparatively high numbers through the first half of this year.

This trend is underscored by the high number of long-term unemployed and is reflective of the difficulty workers are experiencing getting back into the workforce. This group would also include discouraged workers, involuntary part-timers and those who have given up completely.

 

For 40 years, Bill Findley was employed by the state Department of Labor and Industry Center for Workforce Information and Analysis as a workforce information specialist, monitoring and reporting on labor market developments in this area and across the region. He is a graduate of Pitt with a bachelor’s degree in business administration.