HARRISBURG, PA – The Keystone Research Center (KRC) today released its annual “State of Working Pennsylvania” report, offering a comprehensive analysis of the Commonwealth’s economic landscape as we approach Labor Day. The report highlights significant economic progress while also highlighting ongoing challenges faced by working families.
Claire Kovach, Keystone Research Center senior research analyst, and co-author of the report, stated, “Our findings demonstrate that when governments make smart investments in workers and families, as we’ve seen in pandemic recovery efforts, it can play a vital role in lifting wages and ensuring that the rising tide of a growing economy lifts all boats.”
Key Findings:
- PA’’s economy is experiencing steady growth, with output now exceeding pre-pandemic levels, and full recovery taking two years instead of six after the Great Recession.
- The state’s job growth has been exceptionally strong, close to and sometimes outpacing national rates for three years now. This is noteworthy given Pennsylvania’s slow working-age population growth, which places a limit on job creation.
- Unemployment rates have plummeted to a remarkable 50-year low–and stayed there. Even more encouraging–big drops in unemployment rates of Black and Hispanic workers, reducing racial disparities in the job market.
- Wage growth has outpaced inflation in all demographic groups, all parts of the earnings distribution (but especially at the low end), and even for blue-collar workers–which means more money in workers’ pockets and more purchasing power for families.
- Union membership is experiencing a resurgence, particularly in the private service sector. This trend suggests a growing desire among workers for collective bargaining and improved working conditions.
- Despite overall positive trends, too many Pennsylvania workers still don’t earn enough to cover the costs of a bare bones family budget. They struggle especially when the prices of basic necessities spike, although good news on the inflation front recently has helped.
The report lays out the eye-opening jump in private sector union organizing in the Commonwealth. In 2023 alone, union membership in Pennsylvania jumped 30% in the broad private service sector, up 64,000 workers to a new total of 279,000.
“While we celebrate the progress made, including the resurgence of union membership, there’s more work to be done,” said Maisum Murtaza, Research Associate at KRC and co-author of the report. “We need to lock in shared prosperity, not revert to an economy that benefits only the very rich.”
Policy Recommendations:
In Pennsylvania, while low-wage workers have seen progress, they have fallen $1.71 per hour behind their counterparts in New York, New Jersey, and Maryland where state legislators have raised the minimum wage to $15 per hour. That’s over $3,500 for a full-time, full-year worker, a lot of money for struggling families. Pennsylvania lawmakers need to finally pass a big minimum wage increase. That would benefit employers that keep seeing more workers cross the state broader to get a living wage job outside Pennsylvania.
The end of the KRC report addresses national policy and contrasts the policies outlined in the two political parties’ policy platforms and in Heritage Foundation’s Project 2025 report, widely seen as a blueprint should Republicans win the presidential election. On core economic issues, the Democratic platform highlights the importance of raising the minimum wage, strengthening unions, and attaching strong labor standards to federal investments. The Republican platform does not mention the words “union,” “minimum wage,” or “prevailing wage”–the law that requires decent pay on federally funded construction projects. The Project 2025 report advocates eliminating federal prevailing wage laws, shrinking or eliminating unions in the public sector, and making it harder for workers to organize unions independent of management.
“As we approach the November elections, voters need to consider which policy approach is most likely to deliver enduring shared prosperity for all Pennsylvanians,” said KRC executive director and economist, Stephen Herzenberg added.
The full report, “The State of Working Pennsylvania 2024,” is available here.