commentary

(Pittsburgh Post-Gazette)

September 19, 2004

The Bright Lights in Pittsburgh's Future

by Barry Balmat and Peter A. Morrison

Pittsburgh existed long before everyone reading these words was born and it will exist long after all of us have passed on, despite the fears of alarmists that this is a dying city. But what will the Pittsburgh of tomorrow be like?

For decades, the population of the city has been getting smaller and older. The closing of the steel mills and loss of jobs led more young people to leave Pittsburgh in search of jobs and made the city less of a magnet for new residents. The older workers and retirees left behind thus became a larger part of the population.

Pittsburgh's population declined nearly 10 percent during the 1990s, in sharp contrast to the 13 percent nationwide population increase. Since 2000, the city's population loss has continued unabated. Census Bureau estimates released in late June peg the loss at about 1 percent annually through 2003.

And while 18 percent of metropolitan Pittsburgh's population is 65 or older, only 12 percent of the nation's population is in the elderly category.

The conventional wisdom has been that these demographic changes are bad news that foreshadows even worse news in the future. But in some ways, the smaller city and older population we have today have created the seeds for future growth that could help the city bounce back in the years ahead.

As a result of the outmigration of young people during the 1980s and 1990s, Pittsburgh may well find itself with an inordinate shortage of younger people to fill the shoes of older workers. Combine that with a high proportion of the workforce hitting retirement each year and what may well emerge in future years is a region with more jobs than workers around to fill them.

Despite the loss of jobs during the recent recession, optimists have projected a shortage of as many as 125,000 workers in metropolitan Pittsburgh as early as 2008. Who knows what that number might prove to be? What's noteworthy is that Pittsburgh's unfolding demographic future does contain opportunities.

A job surplus combined with a worker shortage could prompt employers to boost wages to attract and retain more people in Pittsburgh jobs. That would be good news for people already working here, who could see their paychecks increase.

The demand for more workers and rising wages could also make metropolitan Pittsburgh a more attractive place for people to move to and for young people to stay after graduating from high schools, trade schools and the colleges and universities in the area.

More people could also choose to make Pittsburgh their home because our declining population has kept housing prices low in comparison with many other cities around the country. Another welcome feature attributable in part to our declining population is that Pittsburgh lacks the excessive traffic congestion that makes commuting an increasing nightmare in ever more cities across the nation.

This new attractiveness could also make immigration from other nations -- once a major force of growth in Pittsburgh's past -- a source once again of growth in the city's future.

All these factors could also make Pittsburgh an inviting location for businesses to grow and expand in the knowledge economy of the future, where commerce expands in cyberspace independent of place.

Indeed, our yearly crop of new college grads is a good source not just of new employees, but also of prospective entrepreneurs with visions of staking out claims in the unlimited realms of cyberspace.

Increasingly in the future, those who would start small businesses of their own that could grow over time will be "place-free" and can operate just as readily in Pittsburgh as in Phoenix.

The economic growth of any region derives largely from its ability to export products and services outside the region -- best evidenced when Pittsburgh was the steel-making capital of the world. The key to success in this area is inventiveness.

Our aging population could create a new launching pad for exports to benefit our economy in the long term. As Pittsburgh invents the technologies, products and services for its population already well along in age, it could do so with an eye towards exporting those capabilities to other regions of the country that will ultimately face the same demands as their baby boomers reach old age.

An inventive Pittsburgh is positioned to pioneer the use of tele-medicine to advance the well-being of elderly residents in cities across the nation. Pittsburgh could also devise model private and public programs that deliver assisted living, along with transportation systems, to serve the special needs of the elderly. These are exportable products and services with a clear future demand and a market that is national and even global.

There are no guarantees, of course, that all these positive outcomes will materialize. But while no one can control the future, we can influence it. The promise for better days ahead in Pittsburgh is there and the prospects will increase if all sectors -- private, public, academic, nonprofit and community groups -- work together to transform what some regard as Pittsburgh's weaknesses inherited from its past into strengths in the future.

Barry Balmat is director of the Pittsburgh office of the RAND Corp., a nonprofit research organization. Peter A. Morrison is a demographer with RAND.

This commentary originally appeared in Pittsburgh Post-Gazette on September 19, 2004. Commentary gives RAND researchers a platform to convey insights based on their professional expertise and often on their peer-reviewed research and analysis.