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TheGerbil

Is it Pittsburgh or is it Pennsylvania?

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I often see or hear complaints about business taxes, slow job growth etc, in Pittsburgh. But I really wish more of these people would look at the whole state. Because maybe Pittsburgh is being blamed for things that are really the state's fault. I certainly get the impression that the state is responsible for setting most business taxes, and that slow job growth is a state-wide problem. So why on earth do so many people keep bemoaning Pittsburgh's job growth alone? I'm willing to bet that there is little we can do to create a boom here unless some state policies change.

Most importantly I would like to know what really needs to be done to create more jobs here. No one seems to know exactly who to blame. The complainers tend to have very vague ideas that don't mean much on their own.

So what do YOU think? What can the city and state do, specifically, to foster more job growth? How can we hook up all the people who want to come back but apparently can't? And is it really as hard to find a job here as some people say it is?

Lots of questions here. Feel free to add more.

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Agreed completely. The state government has been a major contributing factor to the Pittsburgh Region's malaise. The state has instituted archaic and ineffective economic policy for decades. The 2nd highest corporate net income taxes deter business growth. Rendell & Company throw millions in special "incentives" to companies like Westinghouse when they threaten to go to Charlotte... have a nice photo-op... and tout how Pennsylvania is a great place to do business... and never make any effort to reform PA's backwards system. In addition, PA's absurd system of municipal governance cripples the state's local governments, causes regional fragmentation and leaves municipalities weak... without the proper tools to succeed in the modern-day marketplace. Think about it... Pittsburgh is an incredibly weak city politically in comparison to most of its peer cities.

While Pittsburgh has been one of the worst-performing regions in Pennsylvania for many indices (though not wage growth) in the past couple decades... the entire state has been performing poorly in comparison to the rest of the country. Excuses about weather only go so far. Take a look at gigantic Philly... the VAST majority of that metro's population and economic growth occurs in New Jersey and Delaware. According to Census Estimates... Metro Philly has had a population growth rate of 2.5% this decade... however... the 5-county portion in PA only had a 0.9% growth rate. 2/3 of Metro Philly's net population growth was in NJ and DE. Could you imagine if Metro Philly was completely within the domain of Harrisburg??? It would be another Pittsburgh! (only somewhat joking) And unlike Pittsburgh... where job growth continues in the core... jobs have been fleeing Philly's core. Businesses will take advantage of proximity to the pluses of Philly (large market, educational institutions, international airport, etc.) while enjoying the benefits of superior business climates in NJ and DE.

Look around the rest of the state... the smaller cities are either falling into an abyss of obscurity (Erie, Williamsport, Altoona, etc.)... or experiencing extremely low growth (though booming by PA standards) fueled by the nightmarish exurban expansion of the BosWash megalopolis (Allentown, York, Lancaster, etc.)

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Or the New York megalopolis, in the case of the northeast part of the state.

Your comment about companies threatening to leave reminds me of another gripe I have. I think sometimes they make that threat just to get handouts. GNC threatened to leave years ago, and the city helped them fix up a new building downtown. That's all it took to keep them here, which to me implies that the threat was empty, just an attempt to get free money. Yuck! I wonder how much that kind of crap hurts the local economy by taking money that *could* go to helping start-ups grow or brining businesses into the area from outside. Some local companies are simply taking advantage of the region's fear of losing jobs.

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Part of the entire problem is the conservative myth at work in the public perception. Just the stupid idea that 100% of every problem faced by the city and the state is caused by high taxes. It doesn't matter that California has higher taxes and a stronger economy. Doesn't matter that South Dakota has lower taxes and a worse economy. None of that matters. Let's all scream about how much we hate taxes and wish money grew on trees and energy came from perpetual motion machines. The idea that taxes = bad is so black and white that it leaves little room for something the rest of us know as "policy". To all those people who have influence at the state level, policy is an alien concept. Something like maintaining Transit, selling public infrastructure to private investors etc... they are just means to one end: lowering taxes for their friends by cutting services to people they don't care for. Nothing to do with finding a policy that works, just conservative ideology. As soon as those simpleminded fools get kicked out of the government, we will all be better off.

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South Dakota has a worse economy than Pennsylvania? Really? While SD's per capita personal income is well behind PA's at this point... it's % net job growth, % GDP growth and wage growth all destroy Pennsylvania's. Pennsylvania has been one of the worst-performing economies for years... along with fellow basketcases Michigan, Ohio and West Virginia. This has nothing to do with being liberal or conservative... the fact is Pennsylvania has the second highest corporate net income taxes in the country and that is a huge deterrent to doing business in this state. This in turn decreases private sector job growth. It is ridiculous to say because you are liberal that you must support overbearing tax burdens. Nobody's "quality of life" is improved when the state's economy stagnates. Republicans and Democrats alike in state government have not figured out how to make this state compete in the post-industrial economy other than selected tax credits for the Westinghouses.

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I'm sure the truth lies somewhere in between. It is possible to have a booming economy if your taxes are high, but you need other incentives to attract businesses. I think one advantage California has over us is simply that it's been succesful for so long that everyone wants to do business there now. PA isn't attractive in and of itself as a place to do business, so we have to work hard. That includes good policy and also probably changing the tax structure.

We have enough people in our state government who want to do those things, sadly. But I don't think electing Swann would've been the answer either, despite what some people say.

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For the relatively few people who live there and the agrarian economy that South Dakota has had since it's inception, their job growth is not comparable to Pennsylvania's. That's another one of the misconceptions that leads people to misunderstand the situation. Catching up is not the same as forging ahead and it certainly doesn't mean that they are going to surpass anyone, economically speaking. China's GDP growth rate is at 21%... growth rates that are record high on a massive scale incomparable to anything in the history of civilization... I still don't want to be living on a Chinese salary in China, but if I were an investor I would consider investing there. We could nuke PA and start over - that is the ONLY way that the low tax = growth (and nothing else matters) argument holds any water.

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The story of Pittsburgh's "job growth" over the past 25 years is extremely nuanced and complex... while there has been very little "net job growth" in that period compared to other regions like Atlanta or Raleigh... we did create a lot of new jobs to offset the enormous loss of steel and steel-related jobs in the 80s... and Pittsburgh's new jobs tend to be in higher-wage areas compared to many other areas...

The Business Times just did a study ranking income growth over the past 25 years for the nation's 100 largest metros... Pittsburgh ranks 19th. In addition, our per capita personal income is 106% of the national average and ahead of many peer regions, such as Cleveland, Columbus, Cincinnati, St. Louis, Kansas City, Indianapolis, etc.

http://www.bizjournals.com/specials/pages/92.html

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