ECONOMIC BENCHMARKS (9/98)
UPDATED INDICES FOR THE CITY OF PITTSBURGH
AND ALLEGHENY COUNTY
Ralph L. Bangs, Ph.D. and S. Laurel Weldon, Ph.D.
INTRODUCTION
This report provides an update on economic conditions in the City of Pittsburgh and Allegheny County. Our last Economic Benchmarks report was in October 1994, and our last Pittsburgh Benchmarks report on quality of life by race was in September 1996.
In this report we provide four categories of indicators. First, population data show how attractive the area is for people. Second, labor force, employment, and unemployment data show the extent to which people are able to work, which is the most important source of income for most families. Third, personal income data show to what extent people are poor, the distribution of income, and sources of income. Fourth, jobs and places of business data show levels of business activity and the number of jobs provided by employers.
When available, time series data were gathered for the City of Pittsburgh, Allegheny County, and the U.S. The most recent year of data were gathered for the 50 largest cities and 50 largest counties. The largest cities and counties were selected based on population estimates for 1996 by the U.S. Bureau of the Census. The cities and counties included in this report can be found in Tables 2 and 3.
Data for the indicators were used to create time series graphs and current year comparison graphs. Time series data are analyzed mostly from 1989 to the present since 1989 as well as the current year represent peak or near-peak years of the national business cycle. The raw data for each indicator can be found in the tables at the end of the report.
The indicators in this report should be interpreted individually and collectively. We did not create any composite indices or aggregate measures because: 1) some indicators are overlapping; and 2) we have no objective way of weighting the contribution of each indicator to the central concept, economic conditions.
To order copies of this report call the University Center for Social and Urban Research at (412) 624-5442. To discuss the content of the report please call the authors at (412) 624-3856 or write to us at 121 University Place, University of Pittsburgh, Pittsburgh, PA 15260.
We wish to thank The Pittsburgh Foundation and the University of Pittsburgh for their generous support and thank the Advisory Committee for their many helpful comments.
SUMMARY
The main purpose of this report is to identify positive and negative economic conditions and trends in the City of Pittsburgh and Allegheny County in the 1990s. The findings are:
1. Total population continues to decline in the City and County, although the number of African American residents is increasing.
Population decline of nearly 1% per year (about 3,000 persons) has been occurring in the City of Pittsburgh in the 1990s according to Census estimates. Allegheny County’s population has been declining by about 0.5% per year (about 8,000 persons). The City’s population was estimated to be 350,000 in 1996 and the County’s 1,281,000 in 1997. The African American population is increasing by about 1,000 per year in the County. Some of these gains appear to be occurring in the City.
2. The size of the labor force declined by 5% in the City from 1989 to 1997, remained about the same in the County, and increased by 10% in the nation.
There were about 163,000 people in the City’s labor force and 653,000 in the County’s in 1997.
3. The number of residents employed decreased by 6% in the City and 1% in the County from 1989 to 1997 and increased by 10% in the U.S.
About 155,000 residents in the City and 624,000 in the County were employed in 1997.
4. For the first time in at least two decades, the percent of the working-age population participating in the labor force and the percent employed are as high in the County as in the nation.
About 75-80% of the population age 16-64 in the County and the U.S. are either employed or in the labor force.
5. Overall unemployment rates in the City and County are about average for large cities and counties in the U.S. However, large disparities by race still exist.
Unemployment rates in the City, County, and U.S. were around 5% in 1997. African American unemployment in the Pittsburgh MSA in 1996 was two to four times the white rate.
6. The disparity between the percent of employed men and the percent of employed women who worked as executives, administrators, and managers in the Pittsburgh metro area in 1990 was among the highest in the U.S.
Whereas 13.6% of employed men in the region in 1996 worked as executives, administrators, or managers, only 10.1% of employed women worked in this occupation category. The disparity was fifth highest among the 50 metro areas.
7. The poverty rate in Allegheny County increased from 11.5% in 1989 to 12.8% in 1993.
The number of poor also increased in the County, from 143,000 in 1989 to 169,000 in 1993.
8. Compared to African Americans in other large cities, a high percentage of the female-headed African American families in the city of Pittsburgh were in poverty in 1989.
About 56% of African American female-headed families in the City were in poverty in 1989, which was the fifth highest poverty rate among the 48 largest U.S. cities. The disparity between black and non-Hispanic white rates in the City was highest among the 48 largest cities in the nation.
9. Family income inequality in the City of Pittsburgh in 1989, as measured by the ratio of the 90th and the 10th percentile family incomes, was among the highest in the U.S.
Families in the 90th percentile earned 11.3 times as much as families in the 10th percentile. This ratio was 13th highest among the 49 largest cities in the U.S.
10. Income inequality in the City increased rapidly from 1979 to 1989.
The increase of 3.7 in the City’s income inequality ratio from 7.6 in 1979 to 11.3 in 1989 was the fourth highest among large cities in the U.S.
11. Real per capita personal income increased faster in the County in the 1990s than in the U.S. but slower than in most other large counties.
Real per capita personal income increased from 1989 to 1996 by 10% in the County and 6% in the nation. From 1993 to 1996 real per capita income increased 5.4% in the County whereas the median for the 50 largest counties was 5.8%.
Personal income in Allegheny County in 1996 was derived from 1) net earnings (61.5%); 2) dividends, interest, and rent (19.7%); and 3) transfer payments (18.7%). Relative to other large counties, Allegheny County derives a low share of personal income from net earnings and high shares from the other two sources.
12. Job growth continues at low levels in the County.
From 1989 to 1996 wage and salary jobs increased by 3.2% in the County, 6.0% in the Pittsburgh MSA, and 14.1% in the U.S. From 1993 to 1996 wage and salary jobs increased by only 0.5%, which was the fifth smallest growth rate among the 50 largest counties.
13. Average annual wages increased faster in the County than in the U.S. in the 1990s.
Real average annual wage per job increased by 3.9% in the County and by 1.1% in the U.S. from 1989 to 1996. From 1993 to 1996 real wages per job increased by 1.6% in the County, which was higher than the median of 1.2% for the 50 largest counties.
14. A large part of the jobs in the County are in service industries, but in recent years job growth in these industries in the County has been about the slowest for any large County in the nation.
Nearly four out of ten wage and salary jobs in Allegheny County in 1995 were in service industries, such as health, business, education, engineering and management, and social services. From 1993 to 1995 service industry jobs increased by only 1% in the County, which was the second lowest growth rate among the 50 largest U.S. counties.
15. The County has an above average percentage of retail jobs but has far below average growth in retail jobs.
About 17% of wage and salary jobs were in retail in the County in 1995, which was above the median of about 16% for the 50 largest counties. Job growth in retail in the County was 2.7% from 1993 to 1995, which was the eighth smallest growth rate among the 50 largest counties.
16. Jobs in manufacturing, finance-insurance-real estate, and government have been declining in the County in recent years.
From 1993 to 1995 manufacturing jobs decreased by 1.6%, finance-insurance-real estate by 0.5%, and government by 0.9%. The typical large county in the nation had some job growth in these sectors during this period.
17. Both the number of private sector jobs and job growth in computer software have been slightly higher than average in recent years in the County than in most other large counties in the U.S.
Computer software services, a major high tech industry in the County, provided 8,367 jobs in 1995, which was 1.3% of all private sector jobs. Jobs in this industry in the County increased by 16.5% from 1993 to 1995, which is a gain of about 600 jobs per year.
18. During the 1990s there has been no growth in number of private (for-profit and nonprofit) establishments in Allegheny County.
The zero rate of growth in number of private establishments in the County from 1993 to 1995 ranked 11th lowest among the 50 largest counties in the nation. This lack of growth indicates that the formation of new businesses and establishments was no greater than the closure of businesses and establishments in the County.
19. There has been slow job growth in private establishments in the County in recent years.
The number of jobs at private establishments increased 1.2% from 1993 to 1995, which was the ninth lowest rate among large U.S. counties.