Penn State jobs report shows pre-COVID gains, losses

A new report shows that Pennsylvania’s labor economy was resilient throughout the first two decades of the 21st century, even though some industry sectors and regions continued to show job losses.

According to economists at Penn State’s College of Agricultural Sciences, prior to the COVID-19 pandemic, the state showed overall modest employment growth and relatively low joblessness between 2001 and 2019.

Using data from the U.S. Department of Labor’s Bureau of Labor Statistics, the Pennsylvania Department of Labor and Industry, and the U.S. Bureau of Economic Analysis, researchers examined statewide and county-level employment trends in 20 industry sectors. Researchers also compared two business cycles – 2001-2008, the period after a relatively mild recession, and 2008 to 2019, the period encompassing the “Great Recession” and post-recession recovery.

Their report, “Employment Change in Pennsylvania Industries 2001-2019” from the Center for Economic and Community Development, shows annual employment statewide increased by nearly 374,000 – from about 5.6 million jobs to more than 5.9 million jobs.

“The early years of the century show the impacts of a minor recession on Pennsylvania employment, with more than 80,000 jobs lost between 2001 and 2003, followed by a rapid recovery from 2003 to 2005,” Siena Baker, undergraduate research associate and a lead author of the report, said. “With the widespread collapse of the U.S. housing market in 2008 and the subsequent major recession, about 190,600 jobs vanished.”

The report said that recovery after the Great Recession was slow to start but climbed to its pre-recession levels throughout the 2010s. By 2019, the state had gained almost 58,000 jobs, bringing the unemployment rate to about 4.7 percent.

The report said that job growth was uneven, however. While most counties remained relatively steady between 2001 and 2008, with gains or losses below 5 percent, most of the eastern and southeastern counties had strong net positive job growth. After the Great Recession, southeastern counties and some counties in the Philadelphia and Pittsburgh metropolitan areas saw mild recoveries in employment, but many western and northern counties experienced greater job losses between 2008 and 2019 than they did between 2001 and 2008.

Generally speaking, 24 counties, mostly in the southeast, saw job growth during both periods, while 21 counties, primarily in the western and northern areas of the state, saw job losses during both time periods.

Researchers said the state’s job growth lagged behind that of Ohio and West Virginia, however.

Industries that saw job growth included health care and social assistance, adding more than 317,000 jobs between 2001 and 2019. Other industry sectors seeing job growth included accommodation and food service, management of companies and enterprises, professional and technical services, and transportation and warehousing.

Sectors experiencing the most job losses included manufacturing and retail trade, which lost more than 248,000 and 63,000, respectively. The report said the dramatic loss of manufacturing jobs follows a nationwide downward trend in manufacturing employment blamed, in part, on automation and international competition.