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Middle class families in Pennsylvania absorbed income decline in decade ending in 2010

Middle-class families in Pennsylvania have seen incomes decline amid stagnant job growth in “the lost decade” ending in 2010, according to an economic policy think tank in Harrisburg.

From 2000 to 2010, the median income for a four-person family in Pennsylvania decreased by $6,136, to $76,682 from $82,818, said the Keystone Research Center’s annual “State of Working Pennsylvania” report released on Wednesday.

“The typical family was worse off in that decade, which is a departure from the typical pattern in U.S. history,” said Mark Price, the center’s labor economist, on a conference call.

In addition, the state is slow to recoup jobs lost during the Great Recession of December 2007 to July 2009 — a phenomenon the center calls “Pennsylvania’s jobs deficit.”

The state needed 301,000 more jobs as of July to return to pre-recession employment levels, the report said.

“One of the more grim facts is that the jobs deficit has increased by 74,000” from July 2011 to last month, Price said.

The jobs picture in the region was flat during the past decade largely because of extensive layoffs at US Airways locally between 2001 and 2006, said Christopher Briem, an economist at the University of Pittsburgh’s Center for Social and Urban Research. The carrier cut almost 10,000 jobs, going from about 12,000 down to less than 2,000.

“We had to not just overcome the normal economic ebbs and flows but also the loss of the largest private employer in the region,” Briem said.

The 2000-10 period was the first decade since the Depression-marred 1930s that the number of jobs declined in Pennsylvania. The economist said the state’s current stretch of unemployment — at 7.9 percent, as of July — is the longest since the Depression.

Given current economic and policy trends, the center said, Pennsylvania will not reach its pre-recession unemployment low of 4.5 percent for at least 10 years.

The center also said that while median incomes of Pennsylvania familes have declined, the highest earners’ incomes grew significantly. The top 1 percent, or about 62,000 wealthy residents, garnered 76 percent of the income growth in 2010, the first year after the recession.

“Our intent in releasing this report is to reduce the chance we’ll have another lost decade,” said Stephen Herzenberg, an economist and the center’s executive director.

Thomas Olson is a staff writer for Trib Total Media. He can be reached a 412-320-7854 or at [email protected].


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