Hiring slower, Pa. still in the black

HARRISBURG, Pa. (AP) - With the national economy sputtering, Pennsylvania s job growth last year was even slower than originally thought, although the state s bigger-than-expected tax collection through Friday has kept the red ink at bay.
Pennsylvania s economic indicators are being closely watched for signs of job losses or a looming deficit since the federal government reported 35,000 fewer jobs in December and January combined and just about every other northeastern state is projecting a deficit.
"Right now, while the Pennsylvania economy is holding up fairly well, there are some stress lines emerging," said economist Ryan Sweet of Moody s Economy.com.
He added that this year "is going to be a struggle."
Government work force analysts revised last year s hiring numbers downward by 14,000 jobs, a correction that means Pennsylvania added just 25,000 jobs in 2007, or fewer than half the amount added during each of the three preceding years.
The revision was a routine correction made at the end of every year to reflect tax records, instead of the survey data that is released month-to-month.
The difference is not substantial enough to change a 2008 outlook that expects very sluggish, if any, growth in Pennsylvania, said James Diffley of the economic-forecasting firm Global Insight.
Despite the stagnant hiring elsewhere, Pennsylvania added 3,000 jobs in January, according to figures released Thursday.
The state s biggest boost has come from the health care industry, which added 40,000 jobs last year as hospitals and outpatient surgery centers expanded. The manufacturing sector, which Pennsylvania relies on more heavily than the rest of the nation, continued to hemorrhage jobs, losing nearly 20,000 in 2007.
On Friday, the state Revenue Department said it collected $90 million more than projected in February for the state s main bank account. As a result, the state is carrying a $290 million surplus into March and April, the two biggest revenue-collection months of the year.
In testimony Monday in front of the Senate Appropriations Committee, Gov. Ed Rendell s budget secretary, Michael Masch, said he was reasonably confident that the state will finish the fiscal year in the black.
Rendell s proposed $28.3 billion budget for the fiscal year beginning July 1 is counting on any slowdown being brief. The budget would increase spending by $1.1 billion, or 4.2 percent, largely driven by the demands of public schools, prisons and health care for the poor and elderly, Masch said.
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