Pa. workers and businesses grapple with a tight labor market this Labor Day
Tom MacDonald / WHY
A new report on the state of work in Pennsylvania by the Keystone Research Center reveals that there are many more jobs available than people to fill them.
The center’s “State of Working Pennsylvania” report indicates that the high number of available jobs is still on the rise.
“We are still 160,000 jobs short of our February 2020 employment levels, although we have gained more than 6,000 jobs in the last three months,” said research analyst Maisum Murtaza. “Specifically, the pandemic has damaged leisure and hospitality very significantly. Unemployment is still down more than 8% from pre-pandemic levels.
Claire Kovach co-wrote the report and said workers and employers are going through a precarious time in the world of work.
“Workers find themselves increasingly free to leave a job they don’t like and are now convinced they can get another one. And meanwhile, employers should think twice before laying off workers because it can be difficult to find replacements.
Kovach added that some people just don’t want to go back to work after the pandemic.
“Pennsylvania’s workforce is down 2% since November 2019. So even after the initial drop due to COVID, the size of the workforce hasn’t really recovered. People left the workforce for all sorts of different reasons, many with infection issues,” Kovach said. “Some realized that even though it was harder, their families could get by on one income if they didn’t have to pay for child care.”
Steve Herzenberg, economist and executive director of the Keystone Research Center, added that their research shows that the concept of “shared prosperity” is achievable. The World Bank defines shared prosperity as income growth for the bottom 40% of the population.
“With smart, worker-friendly policies over the next few years, Pennsylvania could enjoy a return to shared prosperity for the first time, really, in over 40 years,” Herzenberg said.
He added that wages rebounded due to pandemic layoffs and rehires.
“Low-wage workers are leaving the labor market disproportionately in 2020, which has kind of created an artificial increase in wages measured at different parts of the distribution. And then when low-wage workers came back disproportionately in 2021, that tended to push wages down,” Herzenberg said.
The report also shows economic disparity when it comes to race and ethnicity.
“Wages for black workers and Hispanic workers have also increased, but the ratio of black and Hispanic worker wages to the median now remains around 75% of the white median,” Herzenberg said. He added that this is much less than the roughly 90% ratio for black workers in most of the 1980s.
Pennsylvania’s minimum wage is $7.25 an hour, while neighboring New Jersey pays $13. This means that some who live near the border can earn a quick boost just by crossing the bridge. It also increases competition for workers. Most states surrounding Pennsylvania are moving toward a $15 an hour target, which would further hurt Pennsylvania’s ability to keep and retain low-wage workers.
The report also pointed out that if employers cling to lower wages, their profits continue to rise.
Hospitality jobs are still a long way from where they were before the pandemic. Jobs in the hospitality industry are down more than 8% from February 2020.