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Perspectives

Pittsburgh Perspectives  

Archive List Link to PEQ
Monday, August 29, 2022  10:05 AM  (56)

How has COVID-19 impacted Pittsburgh's Labor Force?

The COVID-19 pandemic has significantly impacted regional and national labor markets. In the Spring of 2020, employment in the Pittsburgh region and across the nation rapidly contracted similarly by over 16% before beginning to recover.

While national employment levels have recently returned to levels comparable to those at the beginning of 2020, many regions have yet to rebound fully. Pittsburgh, in particular, has struggled to reach employment and labor force levels comparable to levels from just before the onset of the pandemic. As of June 2022, total employment in the seven-county Pittsburgh Metropolitan Statistical Area (MSA) remains 3.9% below that of January 2020.

What do we know about regional employment shifts since the onset of the COVID-19 pandemic? Employment data is compiled here from the U.S. Census Bureau’s Quarterly Workforce Indicators (QWI) for employed workers in the seven-county Pittsburgh Metropolitan Statistical Area (MSA). QWI employment data is produced via a federal-state data sharing collaboration—the Local Employment Household Dynamics (LEHD) partnership—which publishes data on employment dynamics and workers’ characteristics for counties and metropolitan areas. The QWI is a unique source of data on worker demographics, including detailed employment breakdowns by sex, age, education, race, and ethnicity. Quarterly employment levels reflect the average employment during each three-month period. The most recent QWI data available is for the 4th quarter of 2021. Here employment for the 4th quarter of 2021 is compared to the 4th quarter of 2019, the last full quarter before the onset of COVID-induced employment declines.

As of the 4th quarter of 2021, total employment in the Pittsburgh MSA remains over 41,000 below comparable employment levels in the 4th quarter of 2019. Employment declines have not been even across all types of workers, and QWI data allows for a deeper look at the characteristics of regional employment shifts during the pandemic.

Overall, regional employment of prime working-age (ages 25-54) workers declined by 4.1% over the two-year period. Within prime working-age cohorts, younger and older workers In the Pittsburgh MSA have declined the most. Workers between the ages of 45 and 54 sustained the largest proportional declines over this period (-6.2%), while the number of workers between the ages of 25 and 34 declined by 5.5%. Only workers aged 34-44 have regained most jobs lost early in 2020.

Workers aged 65 and over previously had one of the steepest declines in employment during 2020 but have since fully rebounded. At the end of 2021, workers aged 65 and over were the only age group in the Pittsburgh region to have higher employment levels compared to the fall of 2019. Though there is evidence that some older workers have been unretiring, or returning to the labor force, this contrasts with recent research from the Federal Reserve Bank of Kansas City which concludes that the bulk of continuing labor force contraction in the United States since the onset of COVID is due to lower levels of elderly workers across the nation. (1) 

The number of regional workers under the age of 25—an age group that includes many enrolled students who hold part-time and full-time jobs—also experienced significant declines in 2020 but regained a large proportion of previous employment levels through the latter half of 2021. Many of these student workers either temporarily or permanently left the region soon after the pandemic emerged.  

Regional employment declines are roughly comparable across genders, but the employment of Black workers in the Pittsburgh region has sustained a significant decline between 2019Q4 and 2021Q4, down 6.7% compared to a decline of 4.1% for White workers. By educational attainment, workers with just a high school degree continue to experience the largest declines, down 4.8% in comparison to workers with a Bachelor’s degree or higher who were just marginally (-0.2%) below pre-COVID levels as of the end of 2021. 

Change in Employment between 2019Q4 and 2021Q4 – Pittsburgh MSA

 

2019Q4

2021Q4

Change

Total Employment

1,059,021

1,017,901

-41,120

-3.9%

 

 

 

 

 

By Age Group

       

Under 25

130,019

124,880

-5,139

-4.0%

25-54

649,773

623,366

-26,407

-4.1%

    25-34

235,131

222,162

-12,969

-5.5%

    35-44

207,670

207,074

-596

-0.3%

    45-54 

206,872

194,030

-12,842

-6.2%

55-64

202,940

192,720

-10,220

-5.0%

65 and over

76,389

77,035

646

0.8%

         

By Gender

       

Male

544,935

524,248

-20,687

-3.8%

Female

514,086

493,653

-20,433

-4.0%

         

By Race

       

White alone

921,402

883,691

-37,711

-4.1%

Black or African American alone

90,256

84,230

-6,026

-6.7%

Asian alone

29,734

31,620

1,886

6.3%

All other

17,629

18,359

730

4.1%

         

By Educational Attainment (Workers Age 25 and Over)

Less than high school

91,767

91,735

-32

0.0%

High school or equivalent, no college

275,448

262,332

-13,116

-4.8%

Some college or Associate degree

287,305

280,447

-6,858

-2.4%

Bachelor’s degree or advanced degree

259,131

258,506

-625

-0.2%

 

 

 

 

 

Source: Compiled from U.S. Census Bureau, Quarterly Workforce Indicators (QWI)

Despite regional employment levels remaining well below pre-COVID levels, the unemployment rate in the Pittsburgh MSA has dropped continuously since the summer of 2020. As of June 2022, the Pittsburgh MSA’s unemployment rate was estimated to be 4.6%, which is now lower than an estimated 4.7% in January 2020 (seasonally adjusted numbers).

Likewise, the estimated number of regional workers in the labor force but unemployed has dropped to levels comparable to the period before the onset of COVID. As of June 2022, an estimated 53,600 workers in the Pittsburgh MSA were unemployed but looking for work, compared to regional unemployment of 57,300 in January 2020 (seasonally adjusted numbers). Pittsburgh’s regional employment declines in large part result from the contraction in the size of the regional labor force, which remainded 3.9% below pre-COVID levels.  

Relatively low unemployment levels suggest there are not a large number of potential workers within the Pittsburgh region who dropped out of the labor force due to covid and who are likely to come back into the labor force. Current regional labor force contraction is likely the result of multiple factors, some induced by COVID-19 but also results from ongoing demographic trends. Workers may have left the labor force due to health reasons exacerbated by COVID-19, early retirement, changing employment preferences, or other reasons. National research suggests that increased challenges in finding affordable child care are depressing labor force participation, especially for lower-income female workers. (2)

The region’s labor force is also likely being impacted by ongoing migration trends and the competition for workers elsewhere. With low unemployment rates across the nation, many metropolitan regions currently have significantly lower unemployment rates than in Pittsburgh. Regional employers are likely facing challenges in hiring and attracting workers more difficult than they have experienced in recent decades.

 

((1)    See: Didem Tüzemen, How Many Workers Are Truly “Missing” from the Labor Force? Federal Reserve Bank of Kansas City Economic Bulletin, May 6, 2022. 

 

(2) Kartik B. Athreya and Sierra Latham, The Pandemic, Child Care and Women's Labor Force Participation, Federal Reserve Bank of Richmond Economic Brief, No. 22-16, May 2022. 




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