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Pittsburgh Perspectives  

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Monday, March 30, 2020  02:05 AM  (33)

Statewide Impacts of Business Shutdowns

On Thursday, March 26 The U.S. Department of Labor reported that over 3.28 million initial unemployment claims were filed across the nation during the week ending March 21, the highest level of new unemployment claims ever recorded. Pennsylvania had the largest increase in the number of first time claims for unemployment insurance with 378,900 initial unemployment claims over the same week. The number of initial unemployment claims in Pennsylvania over the last two weeks was expected to reach 800,000, which would represent over 13% of the state’s total workforce of 6.1 million workers.  

New unemployment claims are being generated by the economic slowdown resulting from the spread of the COVID-19 and public health policies intending to slow the number of new cases.  A significant proportion of Pennsylvania businesses are directly impact by the state’s order to close the physical locations of non-life-sustaining businesses as of 8 p.m. March 19, 2020. On March 22, the state issued an updated list of what specific industries were subject to this order.  

Here the most recent state guidance is used to estimate of the total number of workers impacted by the closure of physical business locations. At least 2.3 million Pennsylvania workers, or just under 42% of all state workers, are potentially impacted by the state’s current order to close operations at their physical workplace locations. The table below estimates the number of workers impacted by industry across the state.  These estimates do not measure the total number of workers who are currently working at home, or the number of workers continuing to receive pay at this time.

Estimated Number of Workers by Industry Impacted by Pennsylvania’s Order to Close Operations t the Physical Locations of Non-Life-Sustaining Businesses

Industry Employment Sept 2019 May Continue
Physical Operations
May Not Continue
Physical Operations
Natural Resources 27,331 27,331  
Mining 27,605 27,605  
Construction 280,639   280,639
Manufacturing 555,582 310,858 244,724
Wholesale Trade 217,712 147,934 69,778
Retail Trade 593,441 306,251 287,190
Transportation and Warehousing 324,362 321,359 3,003
Utilities 34,452 34,452  
Information 90,609 44,272 46,337
Finance and Insurance 265,488 220,930 44,558
Real Estate and Rental and Leasing 65,789 20,429 45,360
Professional, Scientific, and Technical Services 451,467 74,401 377,066
Administration and Support and Waste Management and 329,246 149,548 179,698
Educational Services 492,910 0 492,910
Health Care and Social Assistance 1,091,289 1,045,770 45,519
Arts, Entertainment, and Recreation 91,067 0 91,067
Accommodation and Food 479,510 419,758 59,752
Other Services (except Public Administration) 203,105 97,852 105,253
  5,621,604 3,248,750 2,372,854
    57.8% 42.2%

Employment data is compiled from the Quarterly Census of Employment and Wages (QCEW) for the 3rd Quarter of 2019 data. This data reflects employment and establishments that are covered by the state’s Unemployment Insurance (UI) system.  No adjustment is made for certain industries which have employment data suppressed for confidentiality reasons.

These estimates do not make any adjustment for workers in industries that are permitted to keep their physical locations open, but have likely sent workers home with paid or have already laid off workers. For example, full-service restaurants are eligible to remain open, but the supplemental state guidance that they must close dine-in operations has likely impacted a large proportion of workers in the industry. Also no adjustment was made for the case-by-case exemptions the state has provided to individual businesses allowing their physical workplace locations to remain open. 

These estimates were based on the state’s detailed guidance on which industries were subject to the order to close physical locations. Limited adjustments and consolidations were made to the state’s original industry list, and specific industry NAICS (North American Industrial Classification System) codes were assigned to each listed industry. Employment data for September 2019 was then matched to this industry list by NAICS code. The modified list of industries, NAICS codes and employment levels used to generate the table above is available here.

Update: Summary table updated April 2, 2020

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