Quick rebound projected for region

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A report drafted for the June Conference of Mayors predicted Pittsburgh would be among the first metropolitan regions to reemerge from the prolonged recession and would recover all 35k jobs lost in the last three years by 2012.

The report, assembled by IHS Global Insight, looked at the Gross Metropolitan Product form more than 300 metro areas, as well as employment trends, and made predictions on return to peak employment.

LukeRavenstahl
LUKE RAVENSTAHL

The bulk of the optimism regarding the local metro area rests on the fact that the Pittsburgh metro economy has diversified and is no longer based on manufacturing. As such, with medical, university and hi-tech sectors taking the place of the steel industry, Pittsburgh is in far better shape than Detroit which the report predicts will not regain its former strength for at least a decade.

The report, however, was issued prior to both the federal credit rating downgrade and the austerity budget passed in Harrisburg. Even so, Allegheny Conference on Community Development spokesman Bill Flanagan said, because of its diversity, the metro economy took an earlier, and smaller, hit from the recession and is rebounding sooner, as shown by three years of growth.

The Metro area recorded 3.5 percent growth in Gross Metropolitan Product, from nearly $82 billion in 2008 to 115.6 billion in 2010, ranking it 245 in the nation. Though modest, that output is higher than most metro areas.

“Pittsburgh didn’t experience the housing bubble that some areas did, and we’ve outperformed the national average for four years.” he said. “That projection was pretty accurate when they made it, but we can’t do anything about national economy. As of this moment, trends are still good.”

Flanagan noted there have been 272 business relocations or expansions in the region, making it 8th in the nation.

“And only 70 of those were energy related. We’re also seeing growth in materials sciences and chemicals,” he said. “So despite the federal and state cuts, for now, the trends are still positive.”

The employment projections—a return of 35,000 jobs by the end of next year—may be a bit rosy. As the Courier reported in December, there are an average 15,000 jobs listing published in local papers every month in the region.

“Unemployment is still lower than the national average, but there is an enormous disconnect between what employers are looking for and the skills available in the workforce,” said Flanagan. “They require some level of post-secondary training or education. This is an even larger issue in the Black community, where unemployment is higher.”

Another issue is where these new and expanding businesses are locating.

“They are all in a donut around Pittsburgh and the region’s urban areas,” he said. “And unfortunately, the largest pockets of chronic unemployment, and Black unemployment, are in the cities. Even if you want to be a roustabout on an oil rig, that takes a certain level of training.”

Mayor Luke Ravenstahl was pleased by the report’s projections, and said he is doing what he can to connect people with jobs.

“Every day we are working hard to make sure all residents benefit from Pittsburgh’s Third Renaissance,” he said. “New developments, such as East Liberty’s Target are hiring local residents in the Homewood, Larimer and East End neighborhoods and government is playing a key role in connecting people to jobs and jobs to people.”

Tamiko Stanley, the city’s equal opportunity officer, said a number of other initiatives including housing in the Hill District and East Liberty, and the Bakery Square project are designed to help African-Americans find employment.

“The mayor is including funds in the upcoming budget to ensure new projects and contracts are available with a concentrated effort to include minority service providers and contractors for projects that include Diversity training for City employees and Police Officers,” she said.

(Send comments to cmorrow@newpittsburghcourier.com)

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