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April 20, 2008

Perspective on Pennsylvania economy

Thomas Lifson
To hear the Democrats talk, one would think that Pennsylvania is a basket case economy. That doesn't seem to be the case, as Donald Lambro points out  in the Washington Times today:
  • With a 4.9 percent jobless rate in February, a level economists consider full employment, its labor force was up by 71,000, seasonally adjusted, to more than 6.3 million.

    "The labor force is now at the highest level on record, exceeding the ... all-time high set in January 2007 of 6.29 million," according to the Center for Workforce Information and Analysis. The state has added 178,000 jobs to its payrolls since January 2003.

    The state did not record a sharp rise in home prices that most of the country experienced, so it has not been hit by the precipitous plunge in home values that has struck other states. It is 34th among the 50 states in mortgage foreclosures, with one foreclosure for every 2,245 homes, compared with one for every 557 homes nationally, according to RealtyTrac, which monitors real estate statistics.
  • The median selling price for a single-family home was $168,540 at the end of 2007, up by 2.38 percent since 2006, according to the CNNMoney.com analysis.
• Pennsylvania's once-dominant steel industry has shrunk dramatically in recent decades, but the nation's $75 billion steel industry, which accounts for nearly 10 percent of the global steel market, appears to be making a comeback in the state. U.S. Steel announced a $1 billion expansion plan in December at its plant in Pittsburgh, which could add 600 workers to its labor force.


Of course, there are some factories that have closed down in small towns, where Barack Obama sees people clinging to guns and God, but leftists do not seem to understand that the economy is dynamic. Some industries and facilities become obsolete, while others grow and replace them. Joseph Schumpeter called it "creative destruction." If these jobs did not disappear, then people and capital and land would be unavailable for the new industries. The economy would stagnate and dcline.

Stop feeling sorry for Pennsylvania, if you ever did. It is a beautiful state, full of good people, and is very far from the bleak picture painted by ambitious pols. A relative of mine moved there from New York a few years ago and loves it.

Hat tip: Ed Lasky

Update:

The $1 billion investment US Steel is going to make at its Clairton, PA plant near Pittsburgh is an investment to address enviromnmental issues.  Those 600 jobs Mr. Laskey references are construction jobs which will leave when the project is done.
William R. Casey, PE
Retired USS management employee.

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