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Region's jobless rate fell because workers left workforce

| Tuesday, Feb. 4, 2014, 2:15 p.m.

The Pittsburgh region's unemployment rate fell again in December, but experts say it did so for the wrong reason: more people quit or did not re-enter the workforce.

Hiring at companies large and small has been sluggish and will remain so until momentum from the national economy trickles down to Pittsburgh, said Kurt Rankin, an economist at PNC Financial Services Group.

The seven-county region's seasonally-adjusted jobless rate fell to 6.3 percent in December, down three-tenths of a percentage point. The workforce shrank by 4,200, continuing recent trends, according to figures from a state survey of residents released on Tuesday.

A separate survey showed that jobs at employers in the region fell by 7,400.

“The numbers are not encouraging that the Pittsburgh economy has much momentum going into 2014,” Rankin said. “The momentum looks like it will come from the national economy.”

Companies are expecting consumers to increase spending and as the national economy improves, some of that will filter down to Pittsburgh, where hiring momentum is low, Rankin said.

The region's workforce fell in five of the last six months of 2013, ending the year at 1.251 million. That's down 17,000 from a high of 1.268 million in July.

Rankin said “job growth here petered out last year.” The numbers bear that out, he said.

The region is composed of Allegheny, Armstrong, Beaver, Butler, Fayette, Washington and Westmoreland counties.

“For December, it was a combination of employment increasing and unemployment decreasing so much that the workforce also declined,” said Lauren Nimal, job analyst with the state Department of Labor and Industry. “Instead of going from unemployed to employed, workers are going from unemployed to out of the workforce.”

The trend is happening statewide, Nimal said.

Pennsylvania's seasonally adjusted jobless rate in December was 6.9 percent, down four-tenths of a percentage point, and the national rate was 6.7 percent, down three-tenths, for the same reasons, experts have said.

In December, construction jobs in the region declined by 4,400 because of wintry weather, the state said. Other declines typical for December were in education, down 2,300, and local government, down 400, because of the start of winter break in schools.

“The numbers are clear ... job creation in the area is stalled,” Rankin said. “People are brought into the workforce most often by hiring, which carries its own momentum. ... Most often the largest reason why people fall out of the labor force or don't reenter it is the low availability of jobs at the moment.”

John D. Oravecz is a Trib Total Media staff writer. Reach him at 412-320-7882 or joravecz@tribweb.com.

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