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The number of people working in Pennsylvania hit another record high in August while the number of people looking for work dropped, new data from the Department of Labor and Industry shows.
It's the third month in a row state officials have touted a record-breaking number of people working in Pennsylvania. There are, however, some indications that things are not as rosy as they appear.
The unemployment rate was down 0.2%, dipping to 3.7%, the lowest rate since May 2024. The unemployment rate was down 0.7% from August 2025.
The number of people looking for work in August was down 11,000 compared to the prior month and down 38,000 compared to August 2025.
The number of people working was up 20,000 in August compared to July and up 159,000 compared to 12 months prior. The largest volume gain was in trade, transportation & utilities, up 1,700. Three supersectors -- financial activities, education & health services and leisure & hospitality -- set new record high employment levels in August.
Looking back to the start of 2025, much of the job growth in the state has been driven by hiring in the healthcare and education fields, said Maisum Murtaza, a research analyst at the Keystone Research Center, a left-leaning economic policy think tank.
"When you pull apart the unemployment rate, you can see that the gains are a bit uneven," he said. "There's basically two industries in Pennsylvania that are kind of leading the charge for the job growth that we've seen, and those things are education and health, and then leisure and hospitality. Those are the two ones that we've seen in most gains. In fact, since January of 2025, I think they are responsible for a combined total of almost 53,000 jobs.
Whereas other industries, other important industries, such as manufacturing, trade, transportation, utilities, and specifically government employment have lost nearly 7,000 jobs since January 2025."
The job loss in government employment is linked to layoffs by the federal government, he said, noting that local and state employment have increased over the period.
The change in employment also comes as the state and nation adjust to new work requirement rules for individuals receiving assistance through safety net programs like Medicaid and the Supplemental Nutrition Assistance Program.
The state Independent Fiscal Office earlier this year noted that, as of April, 236,000 SNAP beneficiaries had dropped out of the program and 100,000 people who had been receiving Medicaid benefits were no longer receiving benefits through that program. Work requirements for SNAP recipients went into effect in November 2025. Medicaid recipients do not have work requirements until 2027 but "the recent moderate uptick in the state labor force participation rate could imply that some former SNAP recipients have entered the labor force and may now no longer qualify" for Medicaid, according to the IFO analysis.
Murtaza said, though, that changes to SNAP will lead to job losses in retail and food production fields if people don't have money to spend on groceries. And, if, as critics warn, changes to the Medicaid program lead to job losses in the healthcare field, Pennsylvania will see many of the job gains evaporate.
In addition, in the post-COVID economic recovery, the unemployment rate was so low that even people in groups that typically see higher unemployment rates were finding it easier to get jobs. Unemployment has risen particularly sharply among Black and Hispanic workers, reaching 6.5% and 8.7%, respectively. As recently as 2023, the unemployment rate for Black workers was 3.8% and at an historic low of 4.4% for Hispanic workers.