Lack of Diversity in the Region’s Workforce Raises Concerns

Rayfield Lucas had heard there were well-paying jobs to be had in the shale gas industry; jobs that offered the opportunity to earn his way to a future more secure than the maintenance and warehouse work he’d done in the past could ever promise. He went for it.

A little more than a month after investing in a ShaleNET training program, he had a commercial driver’s license, basic knowledge of shale gas operations and a job with energy giant Halliburton.

“I figure I only have 20 more years to work,” says Lucas, 47, of Hopewell. “From what I hear, the gas industry will be around a lot longer than that.”

His hiring is exceptional not for how quickly he landed a job with no previous experience, but for the fact that he joins a local mining, gas and oil industry in which African Americans like him claim only 2 percent of the jobs.

It’s not much better in several other industry sectors across southwestern Pennsylvania.

A year-long examination of national employment data reveals a southwestern Pennsylvania workforce struggling to look like the rest of the nation and enable racial and ethnic minorities to claim a greater share of the jobs, careers and wealth the regional economy has to offer.

The share of jobs held by African American, Asian American and Hispanic workers in southwestern Pennsylvania is so small that it ranks dead last among 15 regions benchmarked by Pittsburgh Today and a coalition of organizations convened by the nonprofit Vibrant Pittsburgh to explore regional solutions to diversity issues. Several employment sectors where minorities tend to cluster, such as food services, are found at the bottom of the average pay scale. At the same time, minority employment is strikingly low among some of the best-paying employers, such as utilities and the oil and gas industry that Lucas recently joined.

And while minority participation in the workforce has risen in recent years, it’s grown at a pace slower than in many other regions.

Such trends are not broadly quoted economic measures. Yet, the lack of diversity threatens the supply of workers ready to fill jobs vacated by retiring baby boomers and segregates the benefits of gainful employment. It diminishes the region’s appeal to companies looking to relocate or expand. And it makes it more difficult to convince talent of all races and ethnicities to consider southwestern Pennsylvania as a land of promise worth considering for relocation.

“Diversity begets diversity,” says Melanie Harrington, president and chief executive officer of Vibrant Pittsburgh. “Part of the challenge of becoming more diverse is our current lack of diversity.”

A long road ahead

Acclaim for Pittsburgh’s rebirth from the collapse of its industrial economy went global in 2009 when some 4,000 journalists descended on the city to cover the G20 Summit it was hosting. “Pittsburgh’s transformation has captured the attention of other communities now confronted with economic crises of their own,” wrote the Financial Times of London, predicting the summit would “only highlight the city’s progress, signaling to cities such as Detroit and Cleveland that they can once again become vibrant.”

Southwestern Pennsylvania’s decades-old recovery has been nothing short of remarkable. But such accolades ignore the lingering weakness of a regional workforce short on minority workers.

In fact, Pittsburgh trails both Detroit and Cleveland when workforce diversity is the measure.

African American, Asian American and Hispanic workers hold 11 percent of the jobs in the Pittsburgh Metropolitan Statistical Area, according to 2013 data from the U.S. Census Bureau Longitudinal Employer-Household Dynamics (LEHD) program’s Quarterly Workforce Indicators, which includes wage and employment data reported by employers covering 98 percent of U.S. jobs. The rate is more than double in Detroit, where minorities hold 24 percent of the jobs. In Cleveland, they hold 21 percent.

The local pool of minority jobholders is even shallower by comparison than those data suggest. It’s much smaller than the average among benchmark regions, across which minorities hold 25 percent of the jobs. In nearby Baltimore, they claim 37 percent of the jobs. And they hold 44 percent of the jobs in Atlanta, which has the most diverse workforce of any benchmark region.

To be sure, employers find a smaller minority population to hire from in southwestern Pennsylvania, where 86.4 percent of the region’s general population is white. Even so, data suggest local minorities find it tougher to get jobs compared to those living in peer regions. Rates of employment within the region’s African American, Asian American and Hispanic populations all fall below benchmark averages, according to 2013 U.S. Census Bureau American Community Survey data.

And such low rankings come despite the fact that the share of the jobs held by minorities has risen 2 percent in southwestern Pennsylvania since 2002.

The jobs minorities work

Every industry sector has employers with minorities on the payroll. But minority workers tend to concentrate in some industries more than others. And in several industries, the jobs they’re most likely to work earn them below-average incomes.

Minorities, for example, hold 20 percent of the jobs in the administrative and support services sector, making that sector the most diverse in the region. These jobs range from marketing, office work and information technology to security, maintenance, cleaning services and waste disposal. Minority workers in that sector have an average monthly income of $2,761—one of the lowest of all employment sectors, according to LEHD estimates.

The average income for minority workers across all North American Industry Classification System employment sectors was $4,007 a month in 2013.

The lowest incomes are seen among workers in the accommodation and food services industry, where the second-highest concentration of minorities is found. They hold 16 percent of those jobs and have an average income of $1,442 a month. Minority workers do better in the healthcare and social assistance sector, where they claim 14 percent of the jobs and their average income is $4,560, which is higher than the average among white co-workers.

But they are least likely to work in many of the highest-paying industries. Minority workers as a group comprise only 5 percent of the mining and oil and gas industries, where their incomes average more than $8,300 a month. They hold only 8 percent of utility jobs that afford them an average income of more than $7,200 a month.

“When you see the potential for occupational segregation or clustering into lower-wage jobs that don’t have a career trajectory, then you are going to see little growth in income and wealth through time for certain populations,” says RAND sociologist Gabriella Gonzalez. “These trends could have repercussions for those specific families and the economic growth of the region as well.”

It also raises the risk that children of workers whose incomes are low and opportunities few will adopt a dim view of their own chances of success in the economy and will be left with little knowledge of the range of jobs and careers available—and the paths that lead to them. “It promotes an intergenerational cycle of clustering into certain types of jobs, which doesn’t have to happen,” Gonzalez says. “That is potentially what we are seeing in Pittsburgh.”

Such consequences fall more heavily on some minority workers than others.

Stark differences

While the region’s African American, Hispanic and Asian American populations each occupy a thin share of the workforce, the jobs they’re more likely to work and the incomes they’re more likely to earn can vary, and the differences can be significant.

For example, 67 percent of the region’s Asian American adult population are in the workforce, which is higher than among adult whites. And some of the best-paying jobs are found in the industries in which they are more concentrated, such as professional, science and technology, management, wholesale trade and healthcare. But they are not immune from economic disparities. Like all minorities in the region, their rate of poverty is higher than that of whites.

Hispanic residents make up only 1.5 percent of the general southwestern Pennsylvania population. And about 65 percent of Hispanic adults are employed. The industries where they tend to concentrate the most range from education to accommodation and food service. While Hispanic workers earn less than whites in most job sectors, their incomes are higher than their white co-workers in a few, including mining, oil and gas, education, healthcare, and in hotel and food service jobs.

African Americans are the largest single racial and ethnic minority group, making up 8.2 percent of the general population in southwestern Pennsylvania. They also have the deepest roots in the region and a long history of struggling to claim their share of jobs, good jobs and career opportunities.

They are, for example, the only minority workers with average incomes lower than their white co-workers in every industry. An estimated 59 percent of African American adults are in the regional labor force. They claim their largest share of jobs in administrative, support and waste management services, where workers earn some of the lowest monthly incomes. They are also heavily concentrated in the hotel and food service industry, where the average employee income is the lowest.

Another industry where a high concentration of African Americans is found is healthcare and social work, where the jobs allow for better-than-average incomes. Even then, the income for African American workers in those jobs is much lower than what their white co-workers earn.

And nowhere is the racial divide in southwestern Pennsylvania more apparent than in household income and the ability to make ends meet. More African Americans report earnings in the lower income brackets than other races, and fewer African Americans earn enough to put them in the highest brackets, according to data from the 2011 Pittsburgh Regional Quality of Life Survey done by Pittsburgh Today and the University Center for Social & Urban Research at the University of Pittsburgh.

Nearly 18 percent of African Americans in the region say they often or always have trouble paying monthly bills for basic needs such as housing and utilities—more than twice the hardship rate residents of other races report. African Americans are much less likely to own a house. They are more likely to have skipped a doctor visit in the past year because they couldn’t afford it and to live in neighborhoods they consider to be less safe than others.

“The quality of life is so very different, and that’s because of the jobs we are working. African Americans are not well represented in the [industry sectors] where there are opportunities for growth and high incomes,” says Esther Bush, president and CEO of the Urban League of Greater Pittsburgh. “Every time they come out with a study that says Pittsburgh is the most livable city, we say, ‘Most livable for whom?’ That is an honest question.”

Roadblocks to prosperity

The possible reasons why the workforce in southwestern Pennsylvania is short on diversity are numerous. Among them is whether levels of education and skills align with requirements of available jobs. Others include minorities’ awareness of available jobs and career paths and the availability of reliable transportation. Another is the demographics of southwestern Pennsylvania, which find minority and foreign-born residents claiming a smaller share of the general population than in any other Pittsburgh Today benchmark region.

In recent years, for example, employers have been concerned with what is seen as a growing shortage of workers able to fill high-skill professions, such as engineering, as well as workers who can step into middle-skill jobs, which demand a high school education and some additional training, but less than a bachelor’s degree.

The issue is particularly acute in southwestern Pennsylvania, where there has been a profound shift from an industrial economy and the blue-collar jobs that sustained generations to an economy that benefits those trained for vastly different occupations in medicine, research, education, finance, technology and energy. And it hasn’t been kind to those whose skills, training and opportunities have not kept pace, particularly long-time minority workers and their families whose livelihoods and experience were tied to declining industries in the region.

The lack of diversity in the workforce itself tends to limit the job options of minorities, denying them the awareness of a wide range of occupations, what they’d do in those jobs, the skills they need and a network of people they know who are working in those fields.

“Connection to jobs is no minor point,” says Larry Davis, dean of the School of Social Work and director of the Center on Race and Social Problems at the University of Pittsburgh. “So much of what happens to us in life has to do with social capital. How are they going to find someone to teach them how to lay concrete or know someone with a nephew who can help them get a job doing that? They aren’t, because they are out of the network.

“I had a kid in my house the other day who had never seen a black lawyer. This is 2015. This kid was 18 years old. You don’t know what’s possible if you never see it. And it’s hard to be what you’ve never seen.” Rayfield Lucas spent most of his working life in maintenance and warehouse jobs before he decided to retool for the shale gas industry. “That was what I knew and it was convenient for me,” he says.

“We know from research and data that to imagine new careers and pursue them, it is critical to get a realistic preview of what life could be like in those careers,” says Vera Krofcheck, director of strategy and research with the Three Rivers Workforce Investment Board, which directs $12 million a year in workforce development funding. “But we don’t have enough of the cross pollination across careers that happens more organically when you have diversity in the workplace.”

Searching for solutions

Human resources departments, economic development groups, foundations and others have tried for years to build diversity in the local workforce through individual programs and investment.

Recent, more coordinated efforts led by organizations such as Vibrant Pittsburgh, the Allegheny Conference on Community Development and Global Pittsburgh have focused on attracting and keeping minority workers from outside the region to help ease concerns of a manpower crisis in industries such as manufacturing, energy, finance and technology.

Of particular interest has been attracting foreign-born workers. As a group, the region’s foreign-born residents are among the most highly educated in the nation. But they are few in number, claiming only 3.8 percent of the population. Conditions for convincing more to come have improved with growth in job opportunities and the continued strength of local universities.

¡Hola Pittsburgh!, for example, was launched more than two years ago to attract skilled Latino workers to the region and has drawn support from private and public sector partners ranging from corporations and city and county government to economic development, cultural, tourism and arts groups.

“The attraction piece is an awareness issue—making people aware of the opportunities and quality of life in Pittsburgh,” says Dennis Yablonsky, chief executive officer of the Allegheny Conference on Community Development. “We have a large number of international and minority college students. The more we can do to keep them here after they graduate, the better off we’re going to be. And there are populations on the move. Puerto Rico is an example where a lack of economic opportunity causes young people to leave the island every year. They’re educated. They speak English. And they are trained in our areas of need.”

How to help more minorities with generations of history in southwestern Pennsylvania claim a larger share of the workforce and opportunities for more fulfilling jobs is a complex question the region has not been able to answer.

Several examples of efforts to address a piece of the puzzle can be found throughout the region.

Lucas broke into the shale gas industry with training from the region’s ShaleNET program at Westmoreland County Community College, where, in the first eight months of 2014, close to one-in-five roustabout training graduates were minority students. The Three Rivers Workforce Investment Board finds that a significant share of those who use placement services, such as CareerLinks, are minority job seekers, although such services are not specific to them.

More targeted efforts include programs run by The Urban League intended to promote science, technology, engineering and mathematics education among minority students. At Point Park University, the Urban Accounting Initiative goes into middle schools and high schools and organizes summer programs to expose minority and female students to a field that few know about and even fewer tend to enter.

“For these students to get meaningful employment and join the middle class, they’re going to need to be in a white-collar profession,” says Edward Scott, who heads the initiative as Point Park’s George Rowland White Endowed Professor in Accounting and Finance. “And it’s all about whether there is anyone who looks like me that I can relate to; who can show me the possibilities. Just not enough of that has been done.”

Such efforts are small in scale compared to the breadth of the challenge of building the capacity of minorities to succeed, which includes addressing issues ranging from education and poverty to transportation and neighborhood disinvestment.

“We talk about wanting diversity, wanting minorities to come to Pittsburgh. That’s fine,” says Pitt’s Davis, “but the bottom line is: Pittsburgh needs to invest more in the capacity of its own people to take advantage of opportunities that are being created—in its black population, to be candid. You can’t expect anything to grow if you don’t plant the seeds and do the plowing.”

Broad data that vividly depict a workforce woefully short on diversity lend little insight into why that is the case—a full understanding of which remains a work in progress. What is clear is that the issue is pervasive and has been for decades, suggesting that a more coordinated, community-wide strategy involving disparate stakeholders is needed to make southwestern Pennsylvania a place better known for diversity and inclusion than the lack of it.