By John Finnerty
CNHI Harrisburg Bureau
Pennsylvania ranked 43rd out of 50 states in job creation in the 12 months ending in August, according to researchers at Arizona State University, though a spokesman for the governor’s re-election campaign insists the numbers are misleading.
“From the day Tom Corbett was sworn in as governor, Pennsylvania has added over 130,000 private sector jobs and Pennsylvania’s job growth during his term has been above the historical average,” Corbett’s campaign manager Mike Barley said.
However, an analysis by the labor-funded think tank, the Keystone Research Center, found that the pace of the economic recovery has slowed dramatically the longer Corbett has been in office. They largely blame the impact of heavy cuts in funding for schools.
The governor has embraced an ideological strategy of downsizing government while trying to encourage private sector job growth.
The Keystone Research Center, using federal Bureau of Labor data, estimated that the gas drilling industry added 9,900 jobs in Pennsylvania from 2010 to 2012. At the same time, the state shed 45,000 public sector jobs, most of which were teaching jobs cut by cash-strapped school districts.
Pennsylvania’s 10th Congressional District in northcentral and northeastern lost 1,000 jobs even though it includes some of the state’s most intense drilling activity, said Mark Price, a labor economist with the Keystone Research Center.
Pennsylvania has seen a 2 percent increase in jobs — 5.89 million to 6.011 million — from January 2011 to August 2013, according to Pennsylvania Department of Labor statistics. Crawford County’s jobs have decreased by 100 from 39,700 to 39,600 during that time frame.
The Marcellus Shale Coalition, the state’s leading gas industry trade group, estimates that 96 percent of the companies it represents are based in Pennsylvania. Those companies employ 13,099 in the Marcellus and Utica shale regions. But, in the last year, only 57 percent of the new hires for those companies were Pennsylvanians, industry estimates show. Once trained, Pennsylvania workers are told that if they want to keep working they have to go where the drilling is, Price said.
The number of wells operating in Pennsylvania has been cut in half to 50 over the last year due to low gas prices. Thursday, the Marcellus Shale Coalition put out a statement arguing that severance tax proposals by a number of Democratic candidates for governor would further slow drilling activity. Rather than adopt a severance tax, Pennsylvania’s Republican-controlled Legislature put in place an impact fee.
It’s been unclear if the Corbett administration’s strategy of cutting corporate taxes is paying off by encouraging companies to hire, Rep. Jaret Gibbons said. Gibbons is a Democrat whose district includes part of Lawrence County, one of 14 counties in the state that has fewer jobs than when Corbett took office. The others are: Bedford, Blair, Cambria, Cameron, Clarion, Crawford, Huntingdon, Juniata, Mifflin, Somerset, Venango, Warren and Wayne counties.
Gibbons said he’d like to see the state invest more in job-training and education funding.
Two of the biggest policy issues facing state lawmakers this fall also have dramatic jobs implications, Gibbons said.
Proponents have projected that the type of spending included in a Senate proposal, up to $2.5 billion a year, would create 75,000 jobs. Proponents of Medicaid expansion have argued that adding 500,000 people to the insurance rolls would translate into 35,000 health care jobs.
Corbett has been against Medicaid expansion. Instead, he has asked the federal government for permission to funnel those 500,000 working poor Pennsylvanians into private insurance offered through health exchanges created by the Affordable Care Act.
Those in the health insurance industry believe Corbett’s strategy promises more jobs than a boilerplate bid to add people to Medicaid.
First, the governor wants to force people to look for work to get the new government assistance with insurance. Second, insurance companies and brokers could add jobs to deal with the influx of 500,000 more customers, said Vince Phillips, a spokesman for the Pennsylvania Association of Health Underwriters.
“It’s a bold plan,” Phillips said.
Already, 20 insurance brokers registered with the federal government in order to help Pennsylvania consumers select insurance through the government exchanges. Only 10 of the registered brokers are based in Pennsylvania, government records show.
John Finnerty works in the Harrisburg Bureau for Community Newspaper Holdings Inc. He can be reached by email at email@example.com or on Twitter @cnhipa.