STATEMENT: Economic Update—PA Needs Action to Sustain Demand and Make Jobs Worth Taking to Achieve Economic Health Beyond Pre-pandemic Levels

Maisum Murtaza |

Following the release of December job numbers for Pennsylvania last Friday, Keystone Research Center research analyst Maisum Murtaza released the following statement on the health of the state’s economy.


“Pennsylvania gained 14,000 jobs in December and 36,000 in the past two months and its unemployment rate fell to 5.4%, close to the pre-pandemic 5.1%. But the state remains nearly 300,000 jobs short of the February 2020 level, including nearly 90,000 jobs short in the leisure and hospitality sector. Recent job trends make clear that full economic recovery is held back in part by the persistence of the omicron variant of COVIV-19. High infection rates and risks keep some businesses closed or partly closed and keep many adults at home caring for children or because they fear risks of infection to themselves or family members should they return to work.

Looking forward, the data offers three recipes for a full recovery. First, continued diligence with respect to the virus, including raising vaccine rates and maintaining recent increases in the availability of testing. Second, with drop-offs in various prior federal assistance—e.g., for expanded unemployment benefits, rental assistance, small businesses, and the child tax credit—some families and businesses will need additional support to avoid flagging consumer demand slowing economic expansion. In Pennsylvania, investing the $7.5 billion in unspent federal dollars on education, low-income families, and still-struggling businesses is the obvious place to start. Third, to bring more adults back into the job market we need to improve low-wage jobs across the board. The obvious place to start: a robust minimum wage in Pennsylvania. All neighboring states have increased their minimum wage beyond the federal wage of $7.25 per hour and four of those states are on a path to $15 per hour. With infrastructure dollars soon flowing into the state, there is also evidence that Pennsylvania needs to address a potential shortage of trades workers. The best approach to that: ensure that more infrastructure jobs go to the higher-wage unionized sector, which will also need to ramp up recruitment and training efforts that enable low-wage and diverse workers around the state to enter union construction apprenticeship programs.”