Union officials and local politicians hold a rally supporting unionization efforts at a coffee shop in Pittsburgh's Squirrel Hill neighborhood. (AP Photo/Keith Srakocic)
Just out for Labor Day, a new report finds job growth was higher in Pennsylvania than in the nation overall for the first half of this year – but shows signs of slowing down.The State of Working Pennsylvania report analyzes the challenges and opportunities for the workforce. Report coauthor Claire Kovach, the senior research analyst with Keystone Research Center, warned that shifting federal policies are creating tougher conditions for workers.She noted that from mid-2023 through late 2024, unemployment stayed at 3.6% or 3.7% – lower than any pre-pandemic month in more than 50 years. But she said unemployment has begun to creep up.

“In July, it was up to 4%,” said Kovach. “It’s still a pretty low unemployment rate. But we also see that Pennsylvania’s hiring and quit rates are lower than they were last year. So, these figures together indicate there’s more slack in the labor market, and ultimately fewer people are switching jobs – and that’s often because outside opportunities aren’t as plentiful as they were before.”

The report recommends increasing Pennsylvania’s minimum wage to $15 an hour. Last year alone, low-wage workers earned $2,300 a year less than people in Delaware, Maryland, New Jersey or New York, where the wage floor is already at least $15 an hour.

Kovach said nearly a million Pennsylvanians are affected by the state’s lower minimum wage.

Another policy recommendation in the report is that Congress extend the deadlines for ending clean energy and manufacturing tax credits back to the original dates in the Inflation Reduction Act.

Kovach said this includes districts with Republican representatives, which otherwise stand to lose billions in investment and thousands of jobs.

“In the report,” said Kovach, “we document how infrastructure, climate and innovation policies under the Biden administration contributed to a tripling of private construction spending in manufacturing, but that spending has started to dip back down.”

She noted that the uncertainty from a combination of tariffs, federal worker layoffs, increased deportations and canceled research grants and tax credits, is just starting to hit the economy.

The report says Pennsylvania has already seen a sharper uptick in unemployment, especially among workers of color.