Sunday, March 23, 2014

Fracking the lede

So here is a headline from yesterday: Pennsylvania a leader in manufacturing job growth, mayors report findsNo reason to let any inconvenient data get it the way of that, at least as it regards to Pittsburgh. Here is the Pittsburgh trend in manufacturing employment.

The actual article is not as disingenuous as the title. The reporting is all about a report on "energy-intensive" industries with only a loose extrapolation to what is going on here. One line is this:
"Sectors showing potential for growth in Pittsburgh include fabricated metals manufacturing, with jobs expected to grow 1.4 percent annually to 16,606 by 2020," (emphasis added)

So that word 'potential' is awfully important in context there. Look again at the latest data, not a sign of any of that growth yet, at least not here. I know folks so want to believe, but we have not yet taken the big hits on that time series to be caused by the full and final layoffs at Horseheads among others. So the real headline in the very same article relevant to Pittsburgh is the line that says this:
"Employment in iron and steel is forecast to contract by 0.9 percent annually in Pittsburgh through 2020." (again emphasis added)
So the very report being reported on is saying that Pittsburgh's core manufacturing industry is predicted to decline steadily into the future is almost written off. That pessimistic forecast is likely even taking into account the positive and indirect impact being anticipated because of energy costs. Never has such a dour prediction been so lost in a headline. I think that is called burying the lede?

In fact... if you really need to see how unsupportable the jump is from growth in shale development to (local at the very least) manufacturing prognostication.  The very latest data dump has this for the recent employment trends by industry in Pittsburgh.  Check out the bookends of this chart, but at least note that local manufacturing employment is by far the laggard and at -2.3% job decline over the year, plummeting like a rock despite the relatively rapid growth in mining employment.  Pittsburgh manufacturing would have to expand by 25+% just to get back to the level of employment it had when the Renz well was first dropped. 

And to not be misled by the percentages.  The high % growth in mining and logging employment represents +600 jobs over the year. The manufacturing job loss in the region is -2,100 jobs over the same time.  So if you were a mfg worker looking to jump over to mining, there are a lot more of you than there are net new jobs, even if that is what is happening within the labor force.  I have a hypothesis that a lot of local jobs showing up in mining and logging are not exactly blue collar jobs, but a story for another day. 

By the way... was there any resolution to the debate over whether it is spelled fracking or fracing


Anonymous DBR96A said...

So "eds and meds" has taken a hit. Why is that? Is it because of the federal health care bill at all? Inquiring minds want to know.

Sunday, March 23, 2014 12:50:00 PM  
Blogger C. Briem said...

Decline is mostly in educational services, which means mostly higher education (school districts are captured in government). If I had to place one answer, 2013 is really the year schools were reacting to lower state funding put into the budget previously. Lots of uncertainty over how bad it was going to be in the long run, so schools were really digging in. But some of that has stabilized.

Health care in itself was quite flat, but I think much variation we are seeing is more the result of all that is changing in the local market between UPMC and Highmark.. not any longer term trends.

Sunday, March 23, 2014 2:05:00 PM  
Anonymous DBR96A said...

At least it's nothing long-term. I just hope 2013 turns out to be a blip for Pittsburgh in terms of job growth.

Sunday, March 23, 2014 7:54:00 PM  
Anonymous MH said...

I wouldn't be surprised if the boost in professional and business services wasn't related to UPMC gearing up for its legal defense. I bet you go through a lot of lawyers when one starts arguing when you argue that you don't have any employees.

Monday, March 24, 2014 4:19:00 PM  

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