Pain from the worldwide economic collapse in 2008 lingers in Berks County.
How much has the county recovered?
“I have always been an optimist, and there is some good evidence that we are in a recovery mode,” William Buckholz, chairman of Goodman Vending, recently said in an e-mail.
Why not consider a vending business as an informal way of measuring how many people are working, and how much change they can afford for coffee and snacks?
Overall the company lost about 20 percent of its business after the crash and has gained about 4 percent of that back, Buckholz said.
Others in Berks see signs of recovery, especially in employment.
But some measures – such as income and home prices – have not recovered to their pre-crash levels.
All dollar figures in this story are in 2012 dollars.
The U.S. Census shows how the economic collapse affected Berks. Few data are available later than 2010.
Median annual household income in Berks dropped almost $4,000 from 2007 to 2010, from $58,400 to $54,450.
From 2007 to 2010, the number of Berks County residents on public assistance – supplemental security income (SSI), cash assistance, or SNAP-food stamps – rose more than 80 percent – from nearly 20,000 people to more than 35,000.
Over that time, the poverty rate rose from 11.3 percent to 14.1 percent – and from 17.1 percent to 23.2 percent for children.
Sales of homes dropped steadily, from 3,819 sold in 2008 to 3,060 sold in 2011, a drop of 20 percent.
Based on the first quarter of 2012, when 677 homes were sold, even fewer will be sold in 2012 than in 2011.
In April, though, 311 homes were sold, up 11 percent over the 280 sold in April 2011.
The median price of homes dropped almost 17 percent from 2008 to 2011, from $174,700 to $145,321.
Based on prices in the first quarter of 2012, the median price this year will be even lower – $140,000.
Uncertainty about whether prices have hit bottom discourages people from moving, which reduces their ability to get jobs.
“One of the hardest hit sectors of the economy was the housing market,” state Rep. Mark Gillen said in an e-mail.
He sees some signs of recovery there.
“While we have by no means returned to the bubble-like environment of years past, a large inventory from the past few years and low interest rates are making homes more affordable for buyers.
“We are seeing more families taking steps to purchase their own home, and there is anecdotal evidence of an increase in quicker sales and multiple offers at some price points.”
In 2007, there were 1,050 building permits issued in Berks County.
There were 415 issued in 2010.
There were 388 in 2011.
The amount of local taxes the state collects is a sign of economic activity, and Berks remittances fell after the collapse. Data later than the 2010-2011 fiscal year are unavailable.
Sales-tax revenue from Berks County dropped 10 percent from 2008-09 to 2010-2011.
Realty transfer taxes in 2010-2011 were about half of what they were in 2007-08.
Despite those troubling measures, employment rates have been rising.
“This is the slowest recovery in history, but there are continued signs of very modest improvement,” Ellen Horan, president of the Greater Reading Chamber of Commerce and Industry said in an e-mail.
“Anecdotally, employers are reporting trouble hiring. That is primarily due to a skill gap in those unemployed and entering the job market and the available openings. However, it has been quite a few years since this has been a pain point to this extent.”
The last two quarters of 2011 and the first quarter of 2012 each had more job openings advertised online than in any other quarter since the crash.
Another good sign, Horan said, is that local temporary agencies are thriving.
“This is generally a sign of increased hiring,” she said. “While some employers use temp agencies to hire for truly temporary projects or peak production, many use the agencies to outsource the hiring process.”
Jon Scott, president of Greater Reading Economic Partnership, sees another good sign.
Berks County ranks very high among metropolitan areas in the growth of earnings, he noted.
Berks ranked 32 out of 372 metropolitan areas, according to a Garner Economics report for April.
“While trends in employment are the typical gauge of economic well-being, earnings can provide a deeper measure of the value of economic change,” the report states in general. “Significant changes in earnings can point to long-term structural changes.”
Unemployment has been receding in Berks, as well as in America and Pennsylvania, but is still much higher than before the collapse.
In May 2008, the unemployment rate was 5 percent in both Berks and Pennsylvania.
Unemployment hit a peak of 9.6 percent in Berks in February 2010, nearly a percentage point higher than the state’s rate of 8.7 percent that month.
For most of the post-crash period, Berks unemployment rate was higher than the state’s, but they equalized in March at 7.5 percent each.
The recovery hasn’t been as pronounced in the actual number of jobs, notes Edward McCann Jr., chief operating officer of the Berks County Workforce Investment Board.
The number of non-farm jobs in February this year was 3,400 lower than the number in February 2008, a 2 percent drop.
Goods-producing jobs dropped by 4,800 since February 2008, though service-providing jobs increased by 1,400.
Gillen said Berks is benefiting from “the explosive growth of the natural gas industry.”
“While Berks County is not physically located in the Marcellus Shale region, we are still seeing the trickle down effects of this industry on local businesses.”
He pointed to a recent article in the Business Weekly section of the Reading Eagle that highlights some of the ways local companies are becoming involved.