All of Mack Trucks’ heavy-duty vehicles for North America are assembled in the Lehigh Valley facility in Lower Macungie Township.

The Lehigh Valley is leading Pennsylvania’s job recovery from the sharp economic downturn caused by the pandemic two years ago and is tracking ahead of the national recovery, according to newly released data measuring the percentage of employment recovered.

The Lehigh Valley metro region, which includes Lehigh, Northampton, Carbon and Warren counties, in January had regained 96% of the jobs lost since April 2020 amid business disruptions and shutdowns aimed at stemming the spread of COVID-19. Statewide, 79% were recovered. The Lehigh Valley is the only metro region in Pennsylvania to break 90% as of January, according to data analyzed by the Center for Workforce Information & Analysis at the Pennsylvania Department of Labor & Industry.

Lehigh Valley led Pennsylvania in the jobs recovery.

Nationwide, 87% of the jobs lost were recovered, according to a Lehigh Valley Economic Development Corporation (LVEDC) analysis of federal data.

“The Lehigh Valley was ahead in the recovery compared to the state in January 2021,  based on seasonally adjusted total nonfarm jobs, and that continued the rest of 2021,” said statistician Steven Zellers of the Center for Workforce Information & Analysis at the Pennsylvania Department of Labor & Industry.

The Lehigh Valley was among the top five regions in the tri-state area (Pennsylvania, New Jersey, and Delaware) in terms of employment growth over the last year, according to new report by the Federal Reserve Bank of Philadelphia.

The Federal Reserve Bank of Philadelphia analyzed employment gains from January 2021 to January 2022.

Employment in the metro region was 381,200 in January, about an 18,200 increase from a year ago.  Employment had dropped to a low of 308,100 in April 2020.

The Lehigh Valley’s strong recovery is rooted in a balanced economy that had posted a record Gross Domestic Product on the eve of the pandemic, said George Lewis, Marketing, Communications and Research Vice President at Lehigh Valley Economic Development (LVEDC).

“The Lehigh Valley experienced robust job growth in the years leading up to the pandemic because of strong economic fundamentals – diversified industries, a strategic location in the Northeast, and a talented work force. COVID did not change those fundamentals,” Lewis said. “Once the pandemic-induced business disruptions abated, we saw our economy pick up in a very meaningful way.”

Not all industry sectors recovered at the same rate. Employment in the retail and hospitality sectors is still below what it was at the beginning of the pandemic. Those losses are blunted by the increase of employment for the new retail – e-commerce — amid social distancing protocols.

Manufacturing, which took an initial hit due to the in-person nature of the industry, was among the first sectors in the Lehigh Valley to recover. Employment was 40,200 in January, exceeding the pre-pandemic employment of 39,600 in January 2020. Lehigh Valley manufacturers produced an economic output of $7.9 billion, launching the region into a Top 50 U.S. market in 2020 despite the drop in employment.

Makers of non-durable goods, such as food and many medical supplies, saw bigger employment gains in that sector over the last two years — 1,200 jobs beyond what it had before the pandemic as of January, according to data from the U.S. Bureau of Labor Statistics.

“We saw in January [2021] things starting to pick back up, and it’s going gangbusters,” Shelly McWilliams, President of Lehigh Valley Plastics and LVEDC board member, said during a virtual forum last year. “We’re making as many parts as fast as we can, trying to hire people and to meet this demand that is out here. It’s been a complete flip of the switch.”

The Lehigh Valley recovered jobs at a faster pace than Pennsylvania and the United States.

Last year, the LVEDC tracked 20 manufacturing expansions or moves in the Lehigh Valley. OraSure Technologies grew its operations to meet the demand for its expanding business that includes federal contracts for COVID-19 tests. Confectionary maker Stuffed Puffs opened a new facility with proprietary manufacturing process in Hanover Township, Northampton County, and A.P. Deauville, among the nation’s leading marketers and manufacturers of personal care products, relocated from New Jersey, opening its new manufacturing operations in Forks Township, creating 105 new jobs.

A new report by the Federal Reserve Bank of Philadelphia, whose territory includes the Lehigh Valley, paints an optimistic outlook for manufacturing in its district. Nearly 45% of the manufacturers reported increasing employment in this month, pushing the employment index to an all-time high. About 40% of the manufacturing firms surveyed expect activity to increase in the next six months.

The outlook comes amid a recovery of Lehigh Valley’s labor force. Preliminary data show there are 359,700 people employed or looking for a job in Lehigh and Northampton counties. That exceeds what the labor force of 357,500 in January. The unemployment rate is slightly higher now at 5.2% compared to 4.5% two years ago.

The labor force data is preliminary and subject to change.

The LVEDC is working on several talent strategies to ensure a strong labor force in the future. Earlier this year, LVEDC in partnership with the Workforce Board Lehigh Valley commissioned a Talent Study update that highlights the successes and challenges of employers during the pandemic, assesses the regional workforce, and offers strategies employers and educators can use to strengthen the talent pipeline.

The assessment of the talent market is just one of the many initiatives of the LVEDC’s Education and Talent Supply Council, a regional coalition formed in 2015. The council brings together leaders from business, education, and community organizations to identify talent market gaps and implement strategies that strengthen our talent pipeline in the Lehigh Valley.

Other efforts included annual Internship Summits to encourage the creation and expansion of internship opportunities between employers and colleges, a published Internship Toolkit of best practices, and a directory of Career Development contacts. The LVEDC also publishes Hot Career guide, an annual assessment of the most in-demand occupations in the Lehigh Valley with accompanying information on the educational requirements and earnings potential of those jobs.