Hiring continues to slip in Pennsylvania

The state's employers shed 16,400 nonfarm workers from payrolls, with the biggest losses coming among health care and government agencies, the Pennsylvania Department of Labor & Industry reported Friday.

The unemployment rate fell a tenth of a percentage point to 5.3 percent, but primarily because of the number of people who gave up on their search for a job. People who are not actively looking for work aren't considered part of the labor force and don't count as being unemployed.

The September declines, which follow a cut of 1,900 workers in August, highlight how Pennsylvania has been unable to latch onto more robust growth nationwide, said Kurt Rankin, an economist at PNC Financial Services Group.

“It's just torturous the pace at which Pennsylvania's economy is moving forward,” he said.

Pennsylvania's unemployment rate is the same as a year ago and job growth has been slow, increasing by just 0.7 percent in the past year. Meanwhile, the nation's unemployment rate has declined to 5.1 percent from 5.9 percent a year ago, and the number of jobs has increased 2 percent.

The state budget impasse isn't helping, economists said. Some of the biggest job losses were at government agencies, which cut 11,200 workers in September.

It's difficult to know whether those losses are directly tied to public schools and agencies holding back on hiring because of the lack of a budget, said Mark Price, an economist at The Keystone Research Center in Harrisburg.

The longer there is uncertainty, however, the more likely that nervous school districts will trim staff because they don't have the funds to pay employees, he said.

“It could get worse if we don't have some resolution of the budget process,” Price said.

The technology sector has been among the hotter sectors for hiring in the United States, but not so much in Pennsylvania. The state's information sector, which includes some tech firms, cut 300 jobs in September and is down 500 from a year ago.

Meanwhile, Pennsylvania's biggest gains are coming from entertainment venues and hotels. Leisure and hospitality added 8,000 workers last month and 14,600 over the year, accounting for more than a third of the annual job growth.

“That's not very good,” said Frank Gamrat, an economist at the Allegheny Institute for Public Policy. “Those are not very high-paying jobs. You're not going to build your economy on leisure and hospitality.”

Construction firms added 1,500 jobs last month and 11,300 over the past year. Gamrat suspected those gains were tied to projects funded by the Act 89 transportation spending plan passed in 2013.

Pennsylvania's energy sector continues to get hammered by low oil and natural gas prices. Employers in the mining and logging sector lost 100 workers in September and 2,900 over the past year, an annual decline of 7.6 percent and the steepest drop of any sector.

Chris Fleisher is a staff writer for Trib Total Media. He can be reached at 412-320-7854 or cfleisher@tribweb.com.