Local recovery runs ahead of state’s
Warehousing, health care boost region’s employment numbers
The Lehigh Valley’s jobs recovery amid the coronavirus pandemic is slightly outpacing the economic improvement statewide, according to figures released Tuesday by the Pennsylvania Department of Labor & Industry.
Over the past six months, the Allentown-Bethlehem-Easton metro area recovered 60% of the total nonfarm jobs it lost in March and April, said Steven Zellers, a Labor Department analyst. By comparison, Pennsylvania has recovered 56% of nonfarm jobs lost.
Meanwhile, the Lehigh Valley’s seasonally adjusted unemployment rate fell to 7.1% in October, down from 7.8% a month earlier and way below April, when the rate spiked to 16.7%, a nearly 40-year high as the state shut down to mitigate the virus’ spread.
The jobless rate in the Lehigh Valley metro, which includes Carbon, Lehigh, Northampton and Warren County, New Jersey, was the 11th lowest of the state’s 18 metro areas. Pennsylvania’s unemployment rate in October was 7.3%, while the U.S. figure was 6.9%.
“This is a good report for you guys,” Zellers said of the Lehigh Valley’s numbers. “Hopefully, that trend will continue.”
Even with encouraging trends, plenty of concerns exist, namely a virus that roared back in November, straining intensive care units and hospitals across the state as the world waits for a widely available vaccine.
While Pennsylvania hasn’t again enacted widespread shutdown orders that stalled business activity earlier this year, Lehigh Valley business owners say things are improving, according to the latest business sentiment index from local economist Kamran Afshar.
In October, the index rose by 6.4% to reach 49.4, still below the average level during the Great Recession and well off from the January figure of 64.2. Afshar, director of the Kamran Afshar Data Analytics Center at DeSales University, has said a score of 50 or below signals recession or worse.
The state estimated that 30,700 people remained unemployed in the Lehigh Valley in October, a number that contin
ues to improve each month from where it stood in April, when about 74,000 were out of work.
In Lehigh and Northampton counties, initial unemployment claims, or applications for a determination of financial eligibility of benefits, totaled 919 for the week ending Nov. 14, according to Gina Kormanik, business relations director for Workforce Board Lehigh Valley. That’s down significantly from the week ending April 4, when the two counties saw more than 10,000 initial claims.
Continued claims, or those that show people receiving unemployment compensation benefits, are averaging about 16,200, based on the mostrecent four-week period, Kormanik said. In the height of the pandemic, the two counties saw about 51,500 continued claims weekly in May.
As unemployment has declined, however, the labor force also has dropped, a trend seen across the state. The Lehigh Valley’s labor force in October totaled 434,000, down from 446,900 a year earlier. While some of that can be attributed to early retirements due to the pandemic, Zellers said much of that is people who stopped actively searching for work.
Throughout the pandemic, however, Lehigh Valley officials have pointed to the number of available jobs. Kormanik said there are 5,673 job postings listed online in Lehigh and Northampton counties.
What’s doing well?
In the Lehigh Valley, just take a drive on a highway and you’ll likely know what business sectors are performing well.
Employment in the area’s transportation and warehousing sector hit 32,700 in October, which was up 1,800 jobs from September, according to the state.
“COVID has changed the way people shop,” Zellers said. “All that ordering has to come out of warehouses, and you guys have a lot of them.”
Many area warehouses and fulfillment centers have scaled up for the season, receiving an influx of holiday orders. While in-person crowds were thin on Black Friday, Adobe Analytics data shows a record $10.8 billion was spent online across the United States on Cyber Monday, which beat last year’s record of $9.4 billion.
To get those packages to consumers, FedEx Ground last week announced it would hire 1,300 people for a 970,000-square-foot regional sortation facility it recently opened at 8451 Willard Drive in Upper Macungie Township.
The Lehigh Valley’s education and health services sector also logged gains, employing 84,000 in October. That was up from 82,200 the previous month and 81,700 in October 2019.
The professional and business services sector remains down from a year earlier but recorded gains from September. Most notably, employment services had 11,100 employees in October, which was up 600 from September.
“The majority of that is the temp agencies,” Zellers said. “Generally in the leading edge of a recovery, the temp agencies will increase the number of temps used, so that’s a good sign they’re up over the month.”
What’s not up?
While most sectors remain off prepandemic levels, no business industry has been hit harder than leisure and hospitality.
That sector employed 27,700 in the Lehigh Valley in October, down 10,900 jobs from a year earlier.
Within that sector, however, accommodation and food services recorded a gain of 400 jobs from September. But it still has a long way to go.
“It’s not until COVID goes away that you’re going to recover leisure and hospitality, and things that depend on discretionary spending,” Zellers said.
While leisure and hospitality is a major Lehigh Valley industry, the area isn’t as reliant on the sector as some other regions across the state.
For example, back in mid-March, the Brookings Institute predicted the leisure-heavy East Stroudsburg metro area would be the 14th-most exposed region to a pandemic-induced recession, with 25% of its workforce in high-risk industries. That ranking was out of 382 U.S. metro areas.
In October, the East Stroudsburg metro had a seasonally adjusted unemployment rate of 8.9%, the state’s highest.
And in terms of jobs recovered, Zellers said East Stroudsburg has so far regained just 40% of the total nonfarm jobs it lost in March and April.