Pittsburgh's growing labor force (how much, employment, schools)

[BrianTH]

The BLS has released some more April labor data for the Pittsburgh Metro. We had previously been discussing the robust employment numbers, and now we have labor force and unemployment rates as well:

Metropolitan Area Employment and Unemployment Summary

I've become particularly interested in the labor force numbers (the labor force is made up of people who are either employed or actively looking for work as per the BLS definitions). Here are the April labor force numbers going back to 2000 (these are not seasonally adjusted, but since we are looking at the same month that doesn't matter):

2000 1183795
2001 1200505
2002 1205503
2003 1194325
2004 1188600
2005 1188439
2006 1190951
2007 1183786
2008 1210546
2009 1217334
2010 1222505

Note that since April 2007 (the last pre-recession April), our labor force has been steadily increasing, and we are now up a total of 38719 as of April 2010.

This is a pattern that requires some explanation. Typically in a recession the labor force participation rate will decline as some jobseekers become discouraged and stop actively looking for work. As the recovery begins, many of those discouraged people will gradually return to the labor force, but that can take a while. Accordingly, nationally, the civilian labor force participation rate has declined from 65.7% in April 2007 to 64.9% in April 2010 (even though it was up from March to April).

But as noted, our local labor force numbers increased, not decreased. So, this data strongly suggests that we have seen an increase in our labor force from external sources (meaning jobseekers moving here). And it is a fairly reasonable bet that will show up as some sort of overall population increase as well, although this may be hard to sort out (the Census will give us a count as of April 2010, but we won't have a hard count as of April 2007 for comparison).

Anyway, assuming this is all true, the likely driver is the relatively (and I stress relatively) good employment situation in the Pittsburgh area. In fact, note the increase in the labor force is likely making the local unemployment rate higher than it would otherwise be (there is no easy way to know exactly how much, but I think around 2.0% higher is a good bet). And yet despite that effect, we remain substantially below the U.S. national rate.

And as long as our local rate stays substantially below the national rate, I wouldn't be surprised if our labor force--and by implication our overall population--continued to grow. How long such an effect could last is anyone's guess, but it could be an interesting ride for a while.

[bradjl2009]

Originally Posted by BrianTH

The BLS has released some more April labor data for the Pittsburgh Metro. We had previously been discussing the robust employment numbers, and now we have labor force and unemployment rates as well:

Metropolitan Area Employment and Unemployment Summary

I've become particularly interested in the labor force numbers (the labor force is made up of people who are either employed or actively looking for work as per the BLS definitions). Here are the April labor force numbers going back to 2000 (these are not seasonally adjusted, but since we are looking at the same month that doesn't matter):

2000 1183795
2001 1200505
2002 1205503
2003 1194325
2004 1188600
2005 1188439
2006 1190951
2007 1183786
2008 1210546
2009 1217334
2010 1222505

Note that since April 2007 (the last pre-recession April), our labor force has been steadily increasing, and we are now up a total of 38719 as of April 2010.

This is a pattern that requires some explanation. Typically in a recession the labor force participation rate will decline as some jobseekers become discouraged and stop actively looking for work. As the recovery begins, many of those discouraged people will gradually return to the labor force, but that can take a while. Accordingly, nationally, the civilian labor force participation rate has declined from 65.7% in April 2007 to 64.9% in April 2010 (even though it was up from March to April).

But as noted, our local labor force numbers increased, not decreased. So, this data strongly suggests that we have seen an increase in our labor force from external sources (meaning jobseekers moving here). And it is a fairly reasonable bet that will show up as some sort of overall population increase as well, although this may be hard to sort out (the Census will give us a count as of April 2010, but we won't have a hard count as of April 2007 for comparison).

Anyway, assuming this is all true, the likely driver is the relatively (and I stress relatively) good employment situation in the Pittsburgh area. In fact, note the increase in the labor force is likely making the local unemployment rate higher than it would otherwise be (there is no easy way to know exactly how much, but I think around 2.0% higher is a good bet). And yet despite that effect, we remain substantially below the U.S. national rate.

And as long as our local rate stays substantially below the national rate, I wouldn't be surprised if our labor force--and by implication our overall population--continued to grow. How long such an effect could last is anyone's guess, but it could be an interesting ride for a while.

Interesting, I hope our population drop isn't as bad as some think because I think the quick drop in population from 2003-06 may have been exaggerated a little bit.

[BrianTH]

After looking at a lot of different data, I think it is likely true we experienced a brief acceleration of population loss on a Metro level during the housing bubble era (I think the City may have stopped losing population around 2003, but that is a whole different issue). This data supports that thesis (since the labor force declined from 2002 to 2007).

But I think it is very likely that effect has been more than reversed at this point. Whether or not that means the Metro experienced overall population growth since the 2000 Census remains to be seen.

[Honest Bob]

The reason why the labor force increased instead of decreased was due to the fact that many people of retirement age did not retire. Some actually lost their retirement funds in the 401K scams.

Plus many of the new jobs that were added were in the food service industry -- near minimum wage and no benefits. Not to mention the number of schools which have opened up to fleece the poor which does not have a job but has government money to further their education - which the school takes and does not give much of an education - only promises of a better future.

Some trade and technical schools and business colleges had to add a second shift and has classes up to 12 midnight - just trying to accommodate all the unemployed people seeking a education or some type of vocational training.

[BrianTH]

Originally Posted by Little Bevis

The reason why the labor force increased instead of decreased was due to the fact that many people of retirement age did not retire. Some actually lost their retirement funds in the 401K scams.

Why would that happen only in the Pittsburgh region, and not nationally? And is that really a large enough effect to explain these numbers?

Plus many of the new jobs that were added were in the food service industry -- near minimum wage and no benefits.

A minority were, but those were expected seasonal additions. The Pittsburgh region added a lot more jobs after seasonal adjustment as well, and those are almost all attributable to other sectors.

[BrianTH]

It's baaAAaack--after falling off for a while, the labor force spike from earlier in the Great Recession seems to have returned:

Nullspace: There's up and there is up

Briem's graph of August labor force numbers over the years, which is similar to the April series I posted above:

[globalburgh]

Great news. I also noticed a report that was released today celebrating Pittsburgh as one of the top hi-tech growth markets in the country. To the south in Morgantown is even a bigger boom. Monongalia County posted the biggest jump in median household income from 2007-2010 for the entire United States.

[bradjl2009]

I'm starting to get a little concerned that if more jobs seekers start to move here (without securing a job) our unemployment rate will continue to go up even more which could cause more problems in the future with population and the labor force. I hope our lower than the national and state unemployment rate continues.

[BrianTH]

Originally Posted by bradjl2009

I'm starting to get a little concerned that if more jobs seekers start to move here (without securing a job) our unemployment rate will continue to go up even more which could cause more problems in the future with population and the labor force. I hope our lower than the national and state unemployment rate continues.

The problem is that can't last forever--people will keep moving to Pittsburgh if the job situation is notably better, until the job situation is not notably better.

The only way to stop that eventual convergence to a worse unemployment situation is for the rest of the country to start recovering better, which I hope will happen but I have no idea when.

[globalburgh]

Originally Posted by bradjl2009

I'm starting to get a little concerned that if more jobs seekers start to move here (without securing a job) our unemployment rate will continue to go up even more which could cause more problems in the future with population and the labor force. I hope our lower than the national and state unemployment rate continues.

When significant numbers of job seekers start cramming into Pittsburgh on a wing and a prayer, that will spark job creation. Pittsburgh is on the cusp of that sort of positive migration snowball effect.