York County economy still recovering from recession
- York County nearly 5,000 jobs away from rebounding to pre-recession employment levels.
- Manufacturing sector's employment levels continue to drop nationally.
Local economies across the country took a hit during The Great Recession, but as many begin to rebound to pre-recession employment levels, York County remains behind — thanks, in part, to a heavy dependency on manufacturing.
The Great Recession, which the the National Bureau of Economic Research describes as the economic period from December 2007 to June 2009 in the U.S., was caused by factors including a rapid decline in the housing market and high-interest loans that banks couldn't recover.
The period led to widespread bank closures, home foreclosures, a stock market plunge and high levels of unemployment, which reached a peak toward the end of the recession, according to AP reports.
Total employment dropped from 2008 to 2009 in 65 of 67 Pennsylvania counties, many of which, including York, saw significant drop-offs, according to data collected from the state Center for Workforce Information and Analysis.
By the end of 2015, 20 of those counties had fully recovered and even surpassed 2008 employment levels. An additional 12 counties are back within 2 percent of those levels.
York County does not fall into either of these categories.
Tony Billet was one of the final employees let go from a York County architectural design and building firm in 2006 as the company cut back to the bare minimum as it felt pressure ahead of the economic recession.
Billet was able to stay afloat by creating his own business and completing deals abroad, and he said local building and architectural companies have started booming back to pre-recession levels in the past couple of years.
"The problem now is people can't find enough talent in our industry," he said. "We're so busy, it's hard to keep up."
York is one of 16 Pennsylvania counties with more than 100,000 total employment, or employees, according to 2015 data. Of those 16, only Dauphin and Bucks counties are further behind in rebounding to 2008 employment levels in terms of yearly average.
The last few months of 2015 saw York County post employment numbers similar to those of 2008, according to Bureau of Labor Statistics data, with the area's unemployment rate dropping to an eight-year low of 3.9 percent in December. But as a yearly average, the county's total employment was still nearly 5,000 jobs off the 2008 levels.
Hitting every sector: Tom Palisin, executive director of the Manufacturers' Association of South Central Pennsylvania, previously worked in the state's Department of Community and Economic Development.
Palisin said the most recent recession was unique in that it seemed to hit every industry's workforce.
State Department of Labor and Industry data shows York County experienced employment drops in 16 of 20 industries from March 2008 to March 2009, with a total employment drop of 8,420.
Administrative and Waste Services, Construction, and Transportation and Warehousing were hit the hardest, losing approximately 18 percent, 11 percent and 9 percent of their workforce, respectively, in York during that time frame.
Billet, whose job would be considered construction by the state Department of Labor, said firms at the time were forced to cut their employees down to the bare minimum in order to maintain operations.
"I remember being in those weekly meetings where we discussed who would be let go next," he said. "I knew if things didn't turn around, my time was coming."
Billet remembers fear playing a predominant role in his life during those months leading up to his dismissal.
"I had just bought a house, just got married," he said. "It was just this looming darkness, like the opposite of coming out of a tunnel."
That fear made Billet proactive and, after just one month of collecting unemployment compensation, the architectural modeling company he created, abSketches, was sustaining his lifestyle, he said.
Initially, Billet's company was exclusively working on projects overseas, he said, but he has been able to focus locally the past couple of years. His high-tech modeling services are a luxury in the construction industry, and Billet said that his improved success locally is a major sign of economic improvement.
While Billet's assertion that the construction industry is rebounding in the area may be true, the damage may have already been done. With more than 150 local establishments, or companies, gone since 2008, the industry's employment numbers for March 2015 were actually lower than when they dropped off in 2009.
Across all industries, York County is still 4,908 employees away from rebounding to 2008 levels, according to 2015 data.
Major drop in manufacturing: The manufacturing sector saw its March 2015 employment number fall nearly 6,500 below where it was in March 2008.
Jeff Newman, an analyst with the state Department of Labor and Industry, said the drop-off in manufacturing employment is countrywide.
"I don't know if we'll ever recover with the extent of manufacturer outsourcing," he said.
Palisin said manufacturers learned to better utilize technology with fewer employees while surviving the recession, and the result has been a slower rebound for the industry in terms of employment figures.
One economist said the reduction in manufacturing employment presents York County with an opportunity to stabilize its economy across other sectors.
Optimistic companies: Gary Keith, a regional economist for M&T Bank, said maintaining manufacturing jobs is important, but a greater diversification across industries would help reduce "shell shock" for the county during any future economic recessions.
"Very few parts of the country are retaining their manufacturing employment levels," Keith said. "As a community, you need to take what you can and emphasize the industries you can compete in."
He believes York's location bodes well for its long-term economic outlook, he said.
Keith's company recently surveyed nearly 500 businesses in the region and found that mid-sized firms are worried about the national economy but optimistic about their own prospects.
"These mid-sized companies tend to be the backbone of areas like York," Keith said. "Companies in York were maybe even a little bit more optimistic overall than other areas we surveyed."
Keith said company optimism leads to hiring,which turns into positive economic growth.
Keith expects all non-manufacturing sectors to regain pre-recession employment levels in York during 2016, he said.
Note: Unless otherwise noted, all data comes from the state Department of Labor and Industry's Quarterly Census of Employment and Wages (QCEW), which is not seasonally adjusted when referring to specific industries. When applicable, March figures were used because the month is one of the least affected by seasonal employment changes, according to Newman.
— Reach David Weissman at firstname.lastname@example.org.