- The Washington Times - Saturday, April 19, 2008

Sens. Barack Obama and Hillary Rodham Clinton portray Pennsylvania as a state in economic decline, despite business analysts who say it is actually in better shape than many other states teetering on the edge of recession.

During weeks of intensive campaigning in the state’s Democratic presidential primary now just five days away the two rivals have been aggressively touting their campaign proposals to deal with the nation’s economic slowdown and declaring that Pennsylvania is in a recession or heading toward one.

At a town meeting in economically depressed Wilkes-Barre, Mr. Obama said President Bush’s policies “have put our economy into a recession and put the American dream out of reach for so many working people.”

But independent analytical research and media reports show a somewhat brighter economic picture, saying that while the state cannot avoid the impact of the national economic downturn, its economy has been holding up better than most.

“So far, unlike most of America, Pennsylvania’s economy is still chugging along. Home values aren’t dropping, foreclosures aren’t spiking and employers aren’t laying off workers en masse,” said senior writer Tami Luhby in an analysis Tuesday of the state’s economy on CNNMoney.com.

Other analysts support her view. “Right now, the [Pennsylvania] economy is holding up fairly well. But stress lines are emerging,” said Ryan Sweet, economist at Moody’s Economy.com in West Chester, Pa.

Analysts point to these positive economic statistics in the state:

•With a 4.9 percent jobless rate in February, a level economists consider full employment, its labor force was up by 71,000, seasonally adjusted, to more than 6.3 million.

“The labor force is now at the highest level on record, exceeding the … all-time high set in January 2007 of 6.29 million,” according to the Center for Workforce Information and Analysis. The state has added 178,000 jobs to its payrolls since January 2003.

•The state did not see a sharp rise in home prices that most of the country experienced, so it has not been hit by the precipitous plunge in home values that has struck other states. It is 34th among the 50 states in mortgage foreclosures, with one foreclosure for every 2,245 homes, compared with one for every 557 homes nationally, according to RealtyTrac which monitors real estate statistics.

•The median selling price for a single-family home was $168,540 at the end of 2007, up by 2.38 percent since 2006, according to the CNNMoney.com analysis.

•While Pennsylvania’s once-dominant steel industry has shrunk dramatically in recent decades, the nation’s $75 billion steel industry, which accounts for nearly 10 percent of the global steel market, appears to be making a comeback in the state. U.S. Steel announced a $1 billion expansion plan in December at its plant in Pittsburgh, which could add 600 workers to its labor force.

But other analysts also point to the job growth in new technology firms and other businesses that have sprung up in northeast Pennsylvania and around Carnegie Mellon University and the University of Pittsburgh.

The state’s “globally oriented manufacturers are also benefiting from the weak dollar and strong demand for exports from the United States,” the CNNMoney.com report said. “Companies making products such as steel, robotics and technology for international buyers are seeing more business.”

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