Pa. Businesses Optimistic Despite Unemployment Rate

By Eric Boehm | PA Independent

HARRISBURG — Pennsylvania businesses are optimistic about the state’s economy and cautious about the prospects of robust economic growth over the next year, according to a recent survey of CEOs and businesses leaders by the Pennsylvania Chamber of Business and Industry.

A PA Chamber survey found 20 percent of business leaders were optimistic about the state of the economy, the highest level in five years, despite the fact that unemployment in Pennsylvania has climbed from 7.4 percent in May to 8.1 percent in August.

That was due in part to 21 percent of businesses leaders who said they increased their workforces in the past 12 months, a three-year high.

Even so, Pennsylvania’s unemployment rate has climbed from 7.4 percent in May to 8.1 percent in August, though it is unchanged from August 2011.

Gene Barr, the chamber’s president and CEO, said uncertainty over the implementation of the federal health care law and potential changes to federal taxes at the end of the year were holding back growth.

“The reality is that Pennsylvania has taken some of the right strides, but we don’t exist in a vacuum,” he said.

Those numbers might not be changing in the near future, because the survey also warns that businesses optimistic about the future are likely to put off making new hires — as only 17 percent of respondents said they expect to do more hiring in the next 12 months.

From 2002 to 2008, hiring growth was far more robust — averaging around 29 percent per year.

Democrats have dinged Corbett and Republicans for the rapid growth in unemployment over the summer. Prior to August, Pennsylvania’s unemployment rate had been below the federal level for 51 consecutive months.

Even so, 64,000 more Pennsylvanians are working today than when Corbett took office in January 2011, according to the federal Bureau of Labor Statistics.

Businesses surveyed said growth in health-care costs and taxes were their primary economic concerns.