View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

PITTSBURGH, PENNSYLVANIA MSA | OCTOBER 2016

Pittsburgh—A Rising Unemployment Rate

Pittsburgh-area employment rose modestly between March 2015 and March 2016, with most major industry categories in Pittsburgh experiencing
weaker employment gains during this period than those same industries nationally. The area’s unemployment rate has also risen sharply over the
course of 2016, possibly in part because of reduced activity in the energy sector. While the issuance of residential building permits in the area
remains relatively low, home prices have continued to see fairly strong gains. Finally, Pittsburgh’s per capita consumer debt levels have risen more
sharply than in the United States or statewide during the two years ending in the second quarter of 2016, though they remain low.

METRO AREA SNAPSHOT
Unemployment Rate
July 2016

Median Home Values

One-year
change

July 2016

One-year
change

Credit Card
Delinquency Rates

Employment
March
2016

One-year
change

2016:Q1

One-year
change

(thousands)

Pittsburgh

5.7%

0.6

$131,000

4.7%

1,099

0.2%

6.4

0.2

Pennsylvania

5.6%

0.6

$154,500

2.9%

5,725

1.1%

7.3

0.1

Nearby metro average

4.3%

–0.3

$226,825

2.9%

1,593

2.1%

6.4

0.3

United States

4.9%

–0.4

$187,300

5.1%

141,231

1.9%

7.7

0.2

The Pittsburgh area’s unemployment rate rose sharply in 2016.
 UNEMPLOYMENT RATE

Percent
12

6

— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

4

■ Recession

10
8

2
0

2006

2008

2010

2012

2014

2016

The Pittsburgh area’s unemployment rate has risen sharply over the course of
2016. It ended 2015 at 4.8 percent—its lowest point in the current economic
expansion—but has risen almost a percentage point, to 5.7 percent, as of
July. In doing so, it has followed the path of Pennsylvania’s unemployment
rate, which rose from 4.7 percent in December 2015 to 5.7 percent as of
August. A possible partial explanation for this trend relates to changes in the
energy industry. A separate employment survey shows a sharp decline in
employment in Washington County, one of the counties in the metro area,
between March 2015 and March 2016. Washington County has the most
active oil and gas wells of any county in Pennsylvania.

Source: Bureau of Labor Statistics/Haver Analytics.

Pittsburgh’s per capita GDP grew 1.0 percent in 2015, well below its
growth rate in 2014.
 GROSS DOMESTIC PRODUCT

Index, 2007=100
112
— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

108
104
100

■ Recession

96
92
2005

2007

2009

2011

2013

Source: Bureau of Economic Analysis/Haver Analytics.

2015

Pittsburgh’s per capita GDP grew 1.0 percent in 2015. That’s well below
the growth rate registered in 2014, when the area’s per capita GDP grew
3.7 percent, and also below the area’s annualized growth rate over the
preceding five-year period (2009 to 2014), which was just over 2 percent.
Per capita GDP growth was weaker in the Pittsburgh area in 2015 than
in the state and the country as well, with GDP growing 2.2 percent in
Pennsylvania and 2.5 percent in the United States.

PITTSBURGH, PENNSYLVANIA MSA

FOURTH DISTRICT METRO MIX
YOUR DISTRICT, YOUR DATA

OCTOBER 2016

EMPLOYMENT AND INDUSTRIAL SECTORS

Since fully recovering the jobs lost during the Great Recession, the
Pittsburgh area has seen little employment growth.

 EMPLOYMENT

Index, 2007: M12=100

Employment levels have remained relatively flat in the Pittsburgh MSA
since early 2012, when the area fully recovered the jobs that it had lost
during the Great Recession. During the four years from March 2012 to
March 2016, employment in the area fell about 0.2 percent. Over the same
time period, Pennsylvania’s employment grew by more than 2 percent,
while national employment grew by more than 7 percent.

105
— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

100

■ Recession

95

90

2006

2008

2010

2012

2014

2016

Source: Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.

Most major industries saw weaker employment gains in Pittsburgh than
in the US, and four sectors saw declines.

Pittsburgh-area employment rose modestly between March 2015 and
March 2016 (0.2 percent). By contrast, during the same time period,
Pennsylvania’s employment grew 1.1 percent, while employment in
the United States grew 1.9 percent. Major industries in Pittsburgh
generally saw weaker employment gains than those same industries
did nationally. The one exception was the construction industry, in
which growth rates in Pittsburgh and the United States were similar.
In addition, four sectors saw declines in the Pittsburgh area but not
in the United States during this yearlong period: manufacturing;
government; trade, transportation, and utilities; and information.

Construction
Leisure and hospitality
Education and health services
Financial activities
Professional and business
services

— Pittsburgh
— Pennsylvania
— United States

Trade, transportation, and
utilities

 EMPLOYMENT GROWTH BY SECTOR

Government
Information
Manufacturing

		 –4
–2
0
2
		Percent change

4

6

Source: Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.

Four sectors grew and contributed significantly to the area’s employment,
while four subtracted substantially from it.
Employment

12-month
change

Share of
employment

Education and health services

225,622

2,829

20.8

Trade, transportation, and utilities

201,993

–1,478

18.6

Professional and business services

165,072

1,399

15.2

Government

114,528

–1,182

10.6

Leisure and hospitality

111,951

3,170

10.3

Manufacturing

85,003

–2,983

7.8

Financial activities

67,219

686

6.2

Construction

47,945

2,627

4.4

Information

16,387

–237

1.5

Sector

Source: Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.
FEDERAL RESERVE BANK of CLEVELAND

 SECTOR EMPLOYMENT

	
Major contributions to the area’s modest employment gains

between March 2015 and March 2016 came from leisure and
hospitality; education and health services; construction; and
professional and business services. By contrast, the following
sectors were major negative contributors to the area’s employment
change: manufacturing; trade, transportation, and utilities; and
government. Also contributing negatively was natural resources
and mining (not shown in the table). This sector shed about 2,400
jobs in the area between March 2015 and March 2016.

PITTSBURGH, PENNSYLVANIA MSA

FOURTH DISTRICT METRO MIX
YOUR DISTRICT, YOUR DATA

OCTOBER 2016

INCOME
Between 2009 and 2014, the Pittsburgh area’s inflation-adjusted
per capita income grew 6.5 percent.

	I NCOME PER CAPITA

Thousands of dollars
54

Throughout the expansion, the Pittsburgh metro area’s inflation-adjusted
	

48

— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

46

■ Recession

52
50

44
42

2006

2008

2010

2012

per capita income growth has been similar to that of the United States and
Pennsylvania. Between 2009 (the first year of the current expansion) and
2014 (the most recent year for which we have data), the Pittsburgh area’s
inflation-adjusted per capita income grew 6.5 percent. That compares with
growth of about 6.0 percent in Pennsylvania and the United States. For
2014, the annual increase was slightly stronger statewide and nationally—
about 2 percent versus a gain of 1.6 percent in the metro area.

2014

Source: Bureau of Economic Analysis/Haver Analytics.

CONSUMER FINANCES
After stabilizing in 2014, consumer debt levels in the area have risen
roughly 4.2 percent.
	C ONSUMER DEBT

Thousands of dollars
80
— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

70
60
50
40

■ Recession

30
20
10

2006

2008

2010

2012

2014

 er capita consumer debt levels declined throughout the first several
P
years of the expansion, generally stabilizing in 2014. In the Pittsburgh
area, they reached their lowest point after the financial crisis in the
second quarter of 2014. In the two years that followed, consumer debt
levels in the area have risen roughly 4.2 percent. By contrast, they grew
1.1 percent in Pennsylvania and 0.7 percent nationally over the same
time period. Nevertheless, the area’s per capita consumer debt levels
remain below those of the state or nation.

2016

Source: Authors’ calculations from the Federal Reserve Bank of New York’s
Consumer Credit Panel/Equifax.

As of June 2016, credit card delinquency rates in the Pittsburgh area
were lower than the state or national average.
	C REDIT CARD DELINQUENCY RATES

Percent of credit card balances delinquent
14
— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

12
10
8
6

■ Recession

4

Credit card delinquency rates appear to have largely stabilized since
the end of 2014. While delinquency rates in the Pittsburgh area were
about a percentage point above the national average just prior to the
Great Recession, the opposite is true more recently. As of June 2016,
credit card delinquency rates in the Pittsburgh area were more than a
percentage point below the national average and almost a percentage
point below the statewide average.

2
0

2006

2008

2010

2012

2014

2016

Source: Authors’ calculations from the Federal Reserve Bank of New York’s
Consumer Credit Panel/Equifax.

FEDERAL RESERVE BANK of CLEVELAND

PITTSBURGH, PENNSYLVANIA MSA

FOURTH DISTRICT METRO MIX
YOUR DISTRICT, YOUR DATA

OCTOBER 2016

HOUSING MARKET

As of July, year-over-year home price gains were stronger in Pittsburgh
than in Pennsylvania and close to those in the US.
 HOUSING PRICES

Year-over-year percent change

Home prices in the Pittsburgh area rose by just under 5 percent on a
year-over-year basis as of July, stronger than the gains seen statewide
(2.9 percent) and close to the gains experienced nationally (5.1 percent)
over the same period. Over the prior ten-year period, home prices in
Pittsburgh have grown at an annual rate of about 2.4 percent, versus
0.4 percent for Pennsylvania and -0.4 percent for the United States.

15
— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
average

10
5
0

■ Recession
–5
–10

2006

2008

2010

2012

2014

2016

Source: Zillow.com/Haver Analytics.

Average monthly permit issuance through the first seven months of 2016
is lower than in any of the previous three years.
	H OUSING PERMITS

Index, 2007: M12=100, six-month moving average
200
180

80

— Pittsburgh
— Pennsylvania
— United States
— Nearby metro
Cincinnati
average
Average of
nearby
metros
■
Recession

60

United States

40

Ohio

160
140
120
100

20
		2006

2008

2010

2012

2014

The issuance of residential building permits throughout the Pittsburgh
area remains relatively low. Average monthly permit issuance in the area
was approximately 124 through the first seven months of 2016. This
compares with average monthly issuance of 178 in 2015 and above 300 in
2013 and 2014. There have been declines in average issuance nationally
and statewide in 2016 compared with 2015 as well, but they are much
smaller in percentage terms than the declines experienced locally.

2016

Source: Census Bureau/Haver Analytics.

DEMOGRAPHICS AND EDUCATION
Pittsburgh Metro Area
			
		
2014
Population

United States

Change from		
2009
2014

Change from
2009

2,358,096

+0.1%

318,857,000

+3.9%

Adults with less than
a high school diploma

7.0%

–1.9%

13.1%

–1.7%

Adults with an undergraduate
degree or higher

31.7%

+3.8%

30.1%

+2.2%

43

+0.7 years

37.7

+0.9 years

$53,202

+2.2%

$54,590

–3.2%

Median age (years)
Median household income

 PITTSBURGH, PENNSYLVANIA

	
According to 2014 US Census Bureau estimates,

Columbus, Ohio, ranks as the 32nd largest of the
381 metropolitan statistical areas in the United States.

Sources: Census Population estimates; American Community Survey.

All monthly and quarterly figures are seasonally adjusted and all dollar figures are in current dollars, except home prices (which are left nominal). Where applicable, these adjustments
are made prior to calculating percent changes or indexes. Several charts use indexed measures to facilitate comparisons across regions and have a reference line at 100. These numbers
can be thought of as the percentages of pre-recession levels. If levels were growing before the recession, pre-recession indexes will be below 100; if levels were falling before the recession, pre-recession indexes will be above 100.
The Federal Reserve Bank of Cleveland, including its branch offices in Cincinnati and Pittsburgh, serves the Fourth Federal Reserve District (Ohio, western Pennsylvania, the northern
panhandle of West Virginia, and eastern Kentucky).

www. clevelandfed.org

FEDERAL RESERVE BANK of CLEVELAND