After a Year with COVID, Pandemic Produces ‘Complex Changes’ in Lehigh Valley Employment
By Nicole Radzievich Mertz on April 13, 2021
A year after the COVID-19 pandemic sent the economy into a recession, Lehigh Valley employers have regained three-fourths of the jobs lost, and unemployment among residents is less than half of what it was when the rate peaked last April.
But the economic recovery has not been linear. The unemployment rate, labor force and jobs are vacillating even as more people become vaccinated and business activity resumes.
After steadily dropping the last half of 2020, Lehigh Valley’s unemployment rate has ticked up the first two months of the year to 7.6% in February, but that rate also reflects more residents have gotten back into the work force, according to data released April 6 by the Pennsylvania Department of Labor and Industry.
The number of Lehigh and Northampton County residents employed in February grew by 2,400 to 323,400. But the number of unemployed residents seeking a job grew by a greater percentage, pushing up the monthly unemployment rate, which is based on the estimate of residents who are employed and unemployed but seeking a job.
The number of jobs at employers in the Lehigh Valley metropolitan region, which also includes Carbon and Warren counties, fell in February for the first time in nine months. It dropped by 400 to 361,900 after the preliminary data was adjusted for seasonal fluctuations.
“The jobs data we are analyzing show the complex changes brought about by the pandemic, and why you need to look at the whole picture to understand how the Lehigh Valley’s economy is being changed by it,” said George Lewis, Vice President of Communications, Marketing and Research at the Lehigh Valley Economic Development Corporation.
Here is a closer look at key Lehigh Valley data points:
The unemployment rate in Lehigh and Northampton counties fell from a historic high of 16.6% in April to 7.6% in February. It is still 3 percentage points higher than February 2020 as the pandemic-induced recession set in.
Unemployment rates are higher year over year in 323 of 389 metropolitan areas across the nation, according to the Bureau of Labor Statistics.
In February, the national unemployment rate was 6.2% and Pennsylvania 7.3%.
The size of Lehigh Valley’s labor force – the number of employed residents and unemployed seeking a job — fluctuated last year amid business closures, social distancing protocols, health concerns, school closures, child care issues and enhanced unemployment benefits.
While the unemployment rate peaked in April, the labor force hit its lowest point in late summer. The labor force fell from 358,100 in February to 348,000 in August, suggesting some residents either took an early retirement or voluntarily stopped looking for a job.
The number of employed, at 323,400 in February, has been fluctuating by about 3,000 residents since September, producing some quirky data. For example, October’s unemployment rate fell from 8.1% to 7.3%; yet the number of employed residents decreased. The reverse happened in February when the unemployment rate and number of employed residents both increased.
Employment in the Lehigh Valley metropolitan region, which is down by 5.7% over last February, is recovering at a faster rate than employment statewide, which is down 7.2%, but not all industries are recovering equally.
Employment in logistics, which was boosted by the rise of e-commerce, is up by 3,600 or 11% year over year. Hospitality jobs, which were vulnerable to business closures aimed at stemming the spread of COVID-19, are down by 7,700 jobs or 21.2%.
Industries experiencing a faster recovery than the total employment in Lehigh Valley are manufacturing (a majority of which fits Pennsylvania definition of essential employment) and health care and social assistance (which includes essential jobs such as nurses).
March labor data will not be released for another month. Real-time indicators, such as job postings, offer some insights as to where the economy is going.
Brookings Institution, a Washington, D.C, nonprofit that has been tracking the recovery, shows that the number of online job postings in Lehigh Valley’s metropolitan region increased by 8% from February to March and is 38% higher than February 2020.
Online job postings analyzed on Chmura Economics’ JobsEQ platform show a more nuanced look at the types of positions being sought by employers in Lehigh and Northampton counties.
Many of the ads are for essential jobs, such as truck drivers and stock fillers at distribution centers. Some professional occupations, including engineers, architects and accountants, show a slight increase during in recent weeks over last year as the economy slid into a recession.
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