Commonwealth of Pennsylvania
Annual Strategy Statement for the
Appalachian Regional Commission
Fiscal Year 2012
Tom Corbett, Governor
December 2011
Prepared by:
PA Department of Community and Economic Development
Appalachian Development Center
Commonwealth Keystone Building
400 North St, 4th Floor
Harrisburg, PA 17120
Table of Contents
I. Letter of Transmittal
II. Overview of the Region
III. Goals, Objectives and Strategies
IV. Pennsylvania ARC Program and Policies
Section II: Overview of the Region
Pennsylvania is proud of its Appalachian heritage, culture and natural beauty. Fifty-two of our sixty-seven counties are located within the vast Appalachian Region. It is a region dominated in many respects by one large central city of national prominence, Pittsburgh, but also contains much smaller communities and rural areas in varying degrees of distress. Pittsburgh, as well as cities such as Erie, Johnstown, Altoona, and Wilkes-Barre/Scranton continues to adjust to significant declines in what were once major industries—(e.g. coal and iron and steel production). In addition, many of the smaller communities are still struggling to identify and develop an economic structure that will hopefully provide the vibrancy needed to provide good jobs, physical infrastructure, and social structure in order to sustain growth and entrepreneurial development. It is also a region facing the benefits and challenges of an evolving natural gas industry that stands to make an impact on hundreds of communities.
Pennsylvania’s rural counties as defined by the U.S. Census Bureau nearly mirror the Appalachian portion of the Commonwealth. The Center for Rural Pennsylvania reports the following characteristics of the region:
Pennsylvania Rural Counties
Demographics
· U.S. Census Bureau data show that during the 2000s, Pennsylvania's Appalachian areas lost more than 27,000 residents (-.5%). Only one other Appalachian state, New York, experienced a loss of population within its ARC region. In comparison, Appalachian Georgia grew by more than 725,000 residents – an increase of nearly 33%. Twenty nine Appalachian PA counties lost population during the 2000s.
· Census data indicates the entire Appalachian region grew by 6.8% in population while Pennsylvania’s 52 Appalachian counties experienced an overall decline of .5%.
· Appalachian Pennsylvania’s per capita income is $35,901 in comparison to the national average of $40,166.
· Appalachian Pennsylvania’s three year average unemployment rate (6.2%) compares favorably to the nation’s 6.6% during the same period. In addition, Appalachian Pennsylvania’s poverty rate of 12.7% is smaller than the national average of 13.5%.
· 82% of Appalachian PA’s citizens have completed high school and 19.1% are college graduates. This compares to 80.4% and 24.4% nationwide.
· From 2000 to 2010, rural Pennsylvania became more racially diverse. In 2000, there were approximately 157,200 residents, or 5 percent of the total population, who were non-white and/or Hispanic. In 2010, 260,300 rural residents, or 8 percent of the total population, were non-white and/or Hispanic.
Households and Families
· In 2005-2009, rural Pennsylvania had 1.4 million households: 54 percent were married couple households; 27 percent were single person households; 8 percent were single parent households; and 11 percent were other types of living arrangements.
· Twenty-eight percent of rural households had children under 18 years old in 2005-2009.
· In 2005-2009, rural households had 2.4 members. In 1960, there was an average of 3.3 people per household.
Income
· The average household income in rural Pennsylvania was $54,840 in 2005-2009. Among rural households, 41 percent had incomes below $35,000 and 12 percent had incomes of $100,000 or more.
· In 2009, per capita personal income in rural Pennsylvania counties was $32,545, or $10,483 less than in urban counties. This gap has more than doubled since 1970, when the inflation-adjusted, rural-urban income gap was $4,900.
· Rural Pennsylvania is becoming increasingly dependent on unearned income. In 2009, about 41 percent of total personal income came from unearned sources, such as interest, dividends and rent, and from government transfer payments, like Social Security and unemployment compensation. In 1970, these sources accounted for 24 percent of the total.
· In June 2010, about 13 percent of rural residents were eligible to participate in the federal Supplemental Nutrition Assistance Program or SNAP (formerly known as food stamps); about 1 percent received cash assistance from programs like Temporary Assistance for Needy Families (TANF); and about 17 percent were eligible to be enrolled in Medicaid (Medical Assistance).
Businesses and Employment
· In the second quarter of 2010, rural Pennsylvania had an average of 84,669 employers, or 24 employers for every 1,000 rural residents. From the second quarter of 2008 to the second quarter of 2010, the number of rural employers decreased less than 1 percent.
· In 2008, 52% of rural Pennsylvania businesses had fewer than five employees. From 2000 to 2008, the number of these small businesses declined 2 percent.
· In the second quarter of 2010, there was an average of 1.26 million people employed in rural Pennsylvania. From second quarter of 2008 to 2010, there was a decrease of 41,075 employees, or 3 percent. In urban counties, 4.17 million people were employed. From 2008 to 2010, the number of employed persons decreased by 161,857 employees, or 4%.
· In 2010 the unemployment rate in rural Pennsylvania was 9.0 percent. The urban rate was 8.5 percent.
Health Care
· Rural counties have fewer primary care physicians than urban counties. In 2008, there was one rural primary care physician for every 1,501 residents. In urban counties, there was one primary care physician for every 981 residents.
· Along with fewer primary care physicians, rural counties also have fewer dentists. In 2009, there was one practicing dentist for every 2,662 residents. In urban counties, there was one dentist for every 1,814 residents.
· In 2008-2009, there were 69 general acute care hospitals, with a total of 8,050 beds, in rural Pennsylvania. In seven rural counties, there were no hospitals. On average, there are 2.35 hospital beds for every 1,000 rural residents. There are 2.8 hospital beds for every 1,000 urban residents.
· In 2007, an estimated 14 percent of rural residents under 65 years old did not have health care insurance. An estimated 11 percent of those under age 65 in urban counties did not have health care insurance.
Education
· In 2005-2009, 18 percent of rural Pennsylvanians who were 25 years old and older had a bachelor’s degree or higher compared to 29 percent of urban Pennsylvanians of the same age. Fourteen percent of rural and 13 percent of urban residents did not have a high school diploma.
· In the 2009-2010 academic year, an estimated 421,700 students were enrolled in Pennsylvania’s 235 rural school districts. From 2006 to 2010, the number of rural students decreased 6 percent. Enrollment projections from 2010 to 2020 show that total enrollment in rural schools will decline 4 percent.
· In 2008-2009, rural school districts spent an average of $12,463 per student, an increase of 29 percent from 2000. Urban school districts spent an average of $13,145 per student, an increase of 27 percent from the 2000.
This FY 2012 Strategy Statement was developed with input from Pennsylvania’s seven Local Development Districts representing citizens and elected officials throughout the entire Appalachian Pennsylvania region. It reflects our commitment to continuation of relationships with other state and federal agencies, and also builds upon a longstanding partnership with the Appalachian Regional Commission. It also puts into action the initiatives outlined in Pennsylvania’s 2011-2014 Appalachian Development Plan.
REGIONAL PROFILES
The following is a recap of social and economic conditions in Appalachia Pennsylvania’s seven regions as contributed by the Local Development Districts.
SOUTHWEST REGION
Allegheny County, home to the City of Pittsburgh, forms the core of the regional economy in Southwestern Pennsylvania.
Between the decennial censuses of 1980 and 2000, Allegheny County experienced one of the largest population losses in the nation, 11.6%. However, figures from the 2010 census reveal the County experienced a much less severe population decline between 2000 and 2010 from 1,281,666 to 1,223,348. The average unemployment rate for 2010 was 7.7%, a considerable increase from the 2009 average of 6.9% but still a full point below the statewide average of 8.7%.
Employment growth in Allegheny County is projected to be relatively flat over the coming decade and shift to moderate growth after 2015.The largest employment sectors are health care and social assistance, retail trade, and accommodation and food services. The largest employers in the county include the University of Pittsburgh Health Care System, the University of Pittsburgh, and PNC Financial Services Group.
The largest employment sector is manufacturing followed by retail trade and health and social assistance services. Largest employers in the county include Butler Healthcare, AK Steel Corporation, and Traco. For 2010, the county’s unemployment rate averaged 7.4%, a very small increase from 2009’s 7.1% average.
Washington County located south of Allegheny County sharing a border with West Virginia contains major north-south and east-west connections with I-70 and I-79. The current population is 207,820 within 66 municipalities a slight increase from the 2000 census figure of 202,897.
The county has witnessed growth recently due to the two Interstates that traverse it. A casino and retail outlets have opened near the intersection of these major corridors. The county has seen a lot of Marcellus Shale activity and business influx. Furthermore, the county is home to two major higher education institutions - California University of Pennsylvania and Washington and Jefferson College.
NORTHWEST REGION
Bordered on the north by New York and on the west by Ohio, the Northwest Region is comprised of Clarion, Crawford, Erie, Forest, Lawrence, Mercer, Venango, and Warren Counties. The 2010 census indicates that the Region has a population of 721,053 which is a 1.8 percent decrease from 2000. This trend of population loss has been persistent since the 1970’s.
The Region is highly diversified in terms of urban and rural. For example, the 2010 census indicates that Erie is Pennsylvania’s fourth largest city, while Forest County is the third smallest county in terms of population. Approximately eighty percent of the population is located in the western portion of the Region, with heavy concentrations in and around the City of Erie, the Shenango Valley in Mercer County, and the City of New Castle in Lawrence County. The eastern portion of the Region is predominately rural and forested.
The Northwest Region's population has a higher percentage of persons over 65 years of age than the national average. According to the 2010 Census, 16.6 percent of the Region's population is 65 years of age and over. The Region’s 65 and over population is projected to increase to 18.7 percent of the total population by the year 2020.
According to the U.S. Census, 13.9 percent of the Region’s residents reported an income of less than $24,999, with an overall median income of $35,126. The Region's median income is approximately 26 percent less than the State of Pennsylvania which has a median income of $47,913. The Northwest Region's median household income is well below Pennsylvania's median household income level. Clarion County has the lowest median household income in the Region, while Erie has the highest. The Region's number of people below the poverty level is also significantly higher than the Commonwealth’s.
The per capita personal income of the Region has remained well below the State average and the national average at least since the 1990's. The average annual percent growth has also lagged significantly behind both the State and national averages.
Manufacturing employment still accounts for a sizable portion of the employment in Northwest Pennsylvania. In 2009, manufacturing employment accounted for seventeen percent of the Region’s employment. However, between 2002 and 2009, manufacturing jobs have been steadily decreasing. Durable goods account for a significant portion of the Region’s employment with high concentrations in the primary metals fabricated metals, and non-electrical machinery grouping. These concentrations are much higher than those of the United States and Pennsylvania. Regionally, much of the heavier manufacturing is located in the western portion of the Region, especially in the New Castle, Shenango Valley, and Erie urban areas. Employment in durable goods manufacturing has been declining since the 1980’s. Manufacturing clusters include plastics, fabricated metals, industrial machining, and wood products. Identified potential clusters include bio-technology and distribution centers.
NORTHERN TIER REGION
Pennsylvania’s Northern Tier is a geographic region consisting of five rural counties in northeast Pennsylvania: Bradford, Sullivan, Susquehanna, Tioga, and Wyoming. The Northern Tier encompasses about 4,000 square miles and is home to approximately 183,000 residents.
Small towns and rural countryside characterize each of the five counties. With a population density of fewer than 46 persons per square mile, the Northern Tier is Pennsylvania’s least densely populated region. In addition to the counties, the region includes 166 separate municipalities and 19 public school districts, resulting in one local government for approximately every thousand residents.
Historically, the region has been slow to change. The economy typically followed and lagged behind national and state trends. Over the years, when the U.S. economy and other areas of the state have improved, the Northern Tier economy remained steady. Likewise, when the economy suffered, the region also suffered, but not as severely.
Right now the region is in the middle of a major economic upheaval with the emerging oil and gas industry cluster. Historically, the rugged nature of the topography of the region has been a barrier to development, ease of transportation, and economic advancement. However, it is this topography, or rather the geological formations under that topography that has caused a boom in recent investment in the region. In the past two to three years, the Marcellus Shale natural gas exploration has grown exponentially. The region is located at the very center of the natural gas drilling that is taking place in the Commonwealth of Pennsylvania. It has the potential to have a significant impact on population, economic development, and the overall identity of the region.
The Northern Tier region had a smaller increase in population than both the state and the nation in the 1990s as well as the 2000s. According to the 2010 US Census, the region had a total population of 182,663, which was a 0.9% increase from 2000. The region was 96.3% white, non-Hispanic, and 49.6% male.