Pa. Job Growth Triples National Rate

Last week saw the release of September state jobs data from the Bureau of Labor Statistics (BLS). Media coverage of this jobs report focused on the unemployment rate only, which shows an uptick in the state unemployment rate contrasted with an unexpected and surprising decline in the national unemployment rate.

However, looking beneath the headlines, the data shows Pennsylvania’s job market actually outperformed the rest of the nation. 

Keep in mind the jobs report uses two sets of surveys: One of 390,000 establishments (businesses) which is used to determine the number of “jobs,” the second of 50,000 households used to calculate the number of persons employed, unemployed and in the labor force, along with the unemployment rate.  These surveys often show different trends.

  • In terms of jobs (establishment data), Pennsylvania added 17,800 jobs in September. This was the second highest in U.S. behind Texas. This represents an increase of 0.3 percent—triple the increase among all 50 states and D.C. (0.1 percent).[1]
  • Switching to household data, BLS shows Pennsylvania added 23,227 employed person in September, the 8th largest growth in nation. This is an increase of 0.4 percent, more than the 50-state growth of 0.3 percent.
  • The data on the unemployed persons is where Pennsylvania trends diverge from the national average. According to BLS, Pennsylvania added 5,407 unemployed individuals, whereas the 50-state total shows 268,054 fewer unemployed persons (see footnote for some questions about this trend).
  • However, what may really surprise readers is the growth in Pennsylvania’s labor force. This is defined as the number of people employed or officially “unemployed” (meaning they are actively seeking work).
    • In September, Pennsylvania added 28,364 individuals to the labor force. This was the third highest in U.S, and represents a growth rate four times the rest of the nation.
    • Over the past year, Pennsylvania’s labor force grew 130,400. Not only is that the second highest in U.S., the growth rate of 2 percent means the state labor force has grown at 18 times the national rate of growth.
    • Over the past year, Pennsylvania was responsible for 74 percent of the 50-state labor force growth.

That is to say that Pennsylvania’s unemployment rate is growing while the state is adding jobs because of growth in our labor force.  Pennsylvania is one of few states where more people are actually trying to look for jobs, which includes those who had previously given up, and those coming to Pennsylvania to find a job, given our relatively strong jobs market.

[1] For comparison, I used the total of all 50-states plus the District of Columbia from the state and local employment and unemployment series, rather than the national employment and unemployment series, as there are data differences between the two sets.  For example, the national unemployment data (which includes Puerto Rico and the Virgin Islands) show 500,000 fewer unemployed persons than the state and local data set-lending credence to Jack Welch’s claim that the BLS unemployment rate is unreliable.