Len Boselovic’s Heard off the Street: The Fed says Pittsburgh's economy is falling behind
October 24, 2016 12:00 AM
Darrell Sapp /Post-Gazette
Streaking bus lights go up Arlington Ave. with the Pittsburgh skyline set in the background.
By Len Boselovic / Pittsburgh Post-Gazette
Here’s some economic news you won’t get from the puffy-chested crowd at the yokel chamber of commerce: The Pittsburgh region lags behind the state and the nation when it comes to several important economic indicators.
The Federal Reserve Bank of Cleveland reports that the region has a higher unemployment rate; is not keeping up when it comes to job and economic growth and housing permits; and is taking on consumer debt at a faster pace.
“The area’s unemployment rate has ... risen sharply over the course of 2016, possibly in part because of reduced activity in the energy sector,” the bank said in a report issued last week.
Pittsburgh’s unemployment rate jumped from 4.8 percent in December to 5.7 percent in July, the period the bank reviewed. It rose to 5.9 percent in August.
The numbers for both months were higher than the statewide unemployment rate — 5.6 percent in July, according to the bank — and the national unemployment rate of 4.9 percent.
A sharp drop in jobs in Washington County, which has the most active oil and gas wells of any county in Pennsylvania, could be behind the increase, according to the bank.
The bank said Pittsburgh region employment grew only 0.2 percent during the 12-month period ended in March versus statewide growth of 1.1 percent and nationwide growth of 1.9 percent.
“Major industries in Pittsburgh generally saw weaker employment gains than those same industries did nationally,” the bank said.
Jobs in four sectors that saw growth nationally through March — manufacturing; government; information; and trade, transportation and utilities — declined in the Pittsburgh region over the same period.
The bank noted a few bright spots.
Prices for homes in the region increased just under 5 percent for the 12-month period that ended in July, topping the 2.9 percent statewide rate and approaching the nationwide rate of 5.1 percent. And the region’s 6.5 percent increase in inflation-adjusted per capita income tops the 6 percent growth statewide and nationally, the bank reported.
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Lawyers who take on the cases of investors who believe they’ve been wronged aren’t impressed with an industry watchdog’s efforts to shed light on problem brokers.
The Public Investors Arbitration Bar Association says instead of spending millions advertising its free BrokerCheck database for checking the backgrounds of brokers and the firms they work for, the Financial Industry Regulatory Authority, FINRA, should have put more information about broker misdeeds into its database. Only seasoned investors know that BrokerCheck may be lacking important information, the group said.
The missing information includes details of why a broker was terminated, including if that person was dismissed while an employer was investigating conduct, bankruptcy filings, and tax liens. Brokers often times get disciplinary actions against them expunged from the database as part of settling investor disputes.
“BrokerCheck reports often omit information about brokers that is highly relevant and necessary for investors to make informed decisions about who they may want to hire,” said Marnie C. Lambert, executive vice president of the lawyers group.
The group also faulted FINRA for not telling investors that state security regulators may have more information about brokers.
Investors are encouraged to consult BrokerCheck before turning over their money to a broker or financial adviser. The database lists a broker’s work history and whether that individual has been accused of or sanctioned for wrongdoing. The site is managed by FINRA, an industry-funded organization that regulates about 640,000 advisers and the 3,900 firms where they work.
The lawyers group cited significant problems with the database in 2014. Two years later, it is accusing FINRA of spending millions on an ad campaign to hype the broken system rather than fix it.
A FINRA spokeswoman said the organization is always looking for ways to improve BrokerCheck and that it will consider the topics raised by the attorneys.
“We continue to welcome input from those who share our goal to protect investors,” she said.
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