Saturday, June 04, 2011

New regional taxonomies

postscript up front:   egads... I just typed that and immediately checked and saw that Mike is already on the beat. We might have the same tipster.   I'll leave this up just as a corollary.

Always worth keeping track of the contrarian:  Five Places Where the Bubble May Burst

Probably the only time in history Pittsburgh and Elko (Nevada) will ever be put in a group of similar places.

but really..  I'm all for caution, but Elko?  Not even an MSA. Elko the city (itself a generous definition) is under 20K in population. It's like comparing us to something the size of a city neighborhood.  The vast Elko micropolitan statistical area is under 50K.  Elko is slated as vulberable because of the impact of gold mining and the view among some that the bubble in gold prices will eventually burst.  The argument for putting Pittsburgh on the list is that most of our recent economic stability can be pegged to growth in health care which again some think is an unsustainable trend.  There is a point in that, but the article actually cites the closure of Braddock Hospital as their key example of our economic apogee.  Seriously, that is their logic.   They also called Braddock a mere 'neighborhood'.  Fighing words for some.

That being said, they have hit upon an important point.. even if it was accidental.  Changes in health care spending can have a palpable impact on the regional economy and last I checked the news, there were some big things brewing in the structure of the regional health care industry.  Impossible for the resolution of all of that not to have some impact, good or bad, on local economic prognostications.

4 Comments:

Anonymous DBR96A said...

Copied from a post of mine on another forum:

That stupid article said that Pittsburgh's economy "relies" on health care spending, as if the economy would collapse without it. Jeez, I had no idea that UPMC was the only employer in town. Apparently 84 Lumber, American Eagle Outfitters, Bayer, BNY Mellon, Bruster's Ice Cream, Dick's Sporting Goods, Federated Investors, FedEx Ground, Fox's Pizza Den, Giant Eagle, GlaxoSmithKline, Google, Heinz, Intel, Lanxess, Nova Chemicals, Plextronics, PNC, PPG, rue21, U.S. Steel and Westinghouse Electric don't employ anybody in Pittsburgh, and apparently there are no small businesses in Pittsburgh either. Either that, or they all get health care funds too.

Face it; if UPMC ceased to exist tomorrow, it'd have about the same effect that the departure of US Airways had: a temporary lull, which, coincidentally, is exactly what I got from that article. Yeah, Pittsburgh has "eds and meds," but it damn sure ain't the only thing it has, and to pretend it is is ignorant.


I've made my point.

Saturday, June 04, 2011 11:09:00 PM  
Anonymous MH said...

UPMC employs 50,000 people. Granted, only 35,000 of them in Pittsburgh, but comparing it ceasing to exist with the departure of U.S. Airways is something that can only be done by ignoring the concept of "orders of magnitude" or the concept of "not commenting while drinking."

Obviously, nobody is thinking they will cease to exist, but it doesn't have to stagger that much for ripples to be felt. Also, West Penn employs 10,000 and faces the same or worse circumstances.

Saturday, June 04, 2011 11:53:00 PM  
Anonymous MH said...

Not that I expect UPMC to have many problems. The federal government is worse at controlling health care costs that US Air is at customer service.

Saturday, June 04, 2011 11:56:00 PM  
Anonymous BrianTH said...

You have to distinguish between the risks faced by firms and the risks faced by industries. UPMC as a firm may well be exposed to various risks, but that doesn't necessarily mean the health care industry in Pittsburgh, as a whole, faces the same risks.

That said, it is a good thing that the Pittsburgh economy has a lot of other growth areas besides health care. I don't think an actual contraction of the health care industry is likely, but a slowing down of the current growth rate seems likely, sooner or later.

Monday, June 06, 2011 10:29:00 AM  

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