Study: Marcellus Shale helping Pittsburgh region economy

Date: June 22, 2011

Employment numbers expected to rebound to pre-slump levels by early 2012.

The following article is from the June 21 Pittsburgh Post-Gazette.

The Pittsburgh metropolitan area is weathering the recession better than many other parts of the country, partly because of Marcellus Shale production, researchers said Monday, projecting that the region’s employment numbers will rebound to pre-slump levels by early 2012.

The Pittsburgh area lost 37,500 jobs beginning in the third quarter of 2008 but will recover that number by the first quarter of 2012, according to a report released as the U.S. Conference of Mayors closed its 79th annual meeting in Baltimore. The report was prepared for the conference and the Council for the New American City by IHS Global Insight, a Colorado-based research firm.

The report didn’t say what kinds of jobs were lost, what types are likely to replace them or why Pittsburgh is faring better than other parts of the country. However, in an email, Tom Jackson, senior economist at IHS Global Insight, said:

“Many areas of Pennsylvania, including the Pittsburgh metro area, are benefitting from the Marcellus Shale drilling activity. That certainly is giving Pennsylvania a boost relative to the rest of the country in terms of employment and gross economic output.”

The University of Pittsburgh, Carnegie Mellon University and other institutions have “helped in a number of ways,” he added. “The universities themselves are big employers, especially when you include the medical centers … They are also producing a large number of graduates in areas of high employment demand, which can help to encourage employers to move to or expand existing operations in the region.”

Joanna Doven, spokeswoman for Pittsburgh Mayor Luke Ravenstahl, said the study reflected the region’s stable real estate market and government efforts to work with private industry on the city’s “Third Renaissance.”

Mr. Ravenstahl did not attend the Baltimore meeting. He is at a Pennsylvania League of Cities and Municipalities meeting instead, Ms. Doven said.

In all, the report looked at employment and other indicators of economic progress for 363 metropolitan areas.

About 30 areas — including Morgantown, W.Va., and State College, Centre County — are expected to return to pre-recession employment numbers before Pittsburgh. The Pittsburgh area is one of about 10 areas, also including Dallas and Fort Collins, Colo. — expected to recoup lost jobs by early 2012.

All of the other areas are expected to take longer to recover. About 35 regions, including the Youngstown, Ohio, area, are not expected to regain all of their jobs until after 2021.

It’s taken the nation longer to recover from this recession than it has other post-World War II slowdowns, the authors said, counting weather disasters and a slow housing market as complicating factors.

Among the 363 metropolitan areas, Pittsburgh ranked 107th in average annual growth of real gross metropolitan product from 2007 to 2009. Real GMP is the total value of goods and services produced in an area, adjusted for inflation; the examination of real GMP from 2007 to 2009 showed an area’s economic performance in the throes of the recession.

Instead of growing, Pittsburgh’s real GMP on average lost one-tenth of a percent annually during those years. Together, the 363 metropolitan areas averaged a 1.3 percent annual dip in real GMP from 2007 to 2009.


Joe Price
Attorney Joe Price is a seasoned Trial Lawyer serving Northeast, Central and Southeast Pennsylvania for the past forty (40) years. He has handled serious personal injury cases in courts throughout the Federal system including New Jersey and New York. Attorney Price is A.V. Rated by Martindale Hubble. He is Board Certified in Civil Practice by the National Board of Trial Advocacy since 1996.