Swing-state Pennsylvania’s economy gets in-depth report

With Pennsylvania being a top swing state in the upcoming presidential election, the Pennsylvania economy is coming under a watchful eye, said Stephen Herzenberg, executive director of the bipartisan Keystone Research Center. 

“There’s a lot of interest in the state of Pennsylvania because of the national elections and because of that there’s been a great deal of interest in Pennsylvania’s economy,” he said. 

He said that to combat any misinformation that may be out there about Pennsylvania’s economy and how it could impact voters’ decisions, the KRC has put out a county-by-county report of economic data on jobs, unemployment, and wages.  

Herzenberg said the user-friendly tool will be invaluable for both local and national reporters seeking to understand whether Pennsylvanians are better off now compared to four years ago, with county-specific breakdowns. 

The good news, he said, is that Pennsylvania’s economy is currently very strong, especially when compared to the rest of the nation. 

“Pennsylvania’s economy is thriving, and workers are doing better than they have in decades,” Herzenberg said. 

He noted that as of August 2024 the unemployment rate was at a record low 3.4%. The prior record was set in February 2000 at 4.1%. 

In fact, the unemployment level is down in every single county in Pennsylvania, with more conservative-leaning counties having the largest drop in unemployment. 

He also noted that job growth has been on par with national job growth in recent years, where previously Pennsylvania’s job growth had been half the national average. 

The KRC also looked at the overall economy under different administrations and found that most metrics for economic growth actually fared better under Democratic administrations. 

According to the report:  

• Annual real GDP growth is 1.2 percentage points faster during Democratic administrations than Republican ones (3.79% versus 2.60%).   

• Total job growth has averaged 2.5% annually during Democratic administrations, while it is barely over 1% annually during Republican administrations. Applied to today’s total workforce, this would imply nearly 2.4 million more jobs created every year under Democratic administrations.   

• The Democratic advantage is even larger in private job growth than it is for total job growth. Notably, business investment is higher during Democratic administrations, with investment growth running at more than double the pace than it does during Republican ones.  

• Average rates of inflation—both overall and “core” measures that exclude volatile food and energy prices—are slightly lower during Democratic administrations. 

It’s important to note that the data in the report does not claim to measure the causal effect of partisan White House control on economic performance, pointing out that the president does not have total control over the economy. 

Heather Long, a Washington Post columnist and former Harrisburg Patriot-News editor, spoke at the unveiling of the KRC report. 

She cautioned that despite low unemployment and significant wage growth, not all is rosy in Pennsylvania right now and there are issues that are negatively impacting the opinions of voters. 

“While overall I agree that the Pennsylvania economy is good and the job market is strong, we’re in a weird hiring freeze right now,” Long said. “Outside the healthcare and local government industries companies aren’t laying off, but they’re not hiring either.” 

She said the result is that it may be taking those who have been laid off longer to find a new job. 

Housing affordability has become a huge issue, Long said. 

“It is currently the most unaffordable time to buy a home in 40 years,” she said. 

While that has added to the wealth of existing homeowners, who have found their homes double or even triple in value, it’s created a barrier to entry for younger Millennial and Gen Z voters. 

“This is a tough fix, and these are the questions that are on voters’ minds,” Long said. 

As Pennsylvania emerges as the single most pivotal state in the upcoming elections, Herzenberg said understanding its economic landscape is vital for both voters and policymakers and his organization hopes the information it is providing helps provide the facts that are needed.