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Pittsburgh shakes off its rust and grows


  • Photo 1 of 2

    A sign hung from the Hilton Hotel in downtown Pittsburgh, Pa., welcomes visitors to the city for the G20 Summit of world economic leaders being held Sept. 24-25.

    - Saul Loeb/AFP/Getty Images

  • Photo 2 of 2

    A cable car on the Duquesne Incline, a funicular railway, climbs a hill overlooking downtown Pittsburgh, Pa.

    - Saul Loeb/AFP/Getty Images

A cable car on the Duquesne Incline, a funicular railway, climbs a hill overlooking downtown Pittsburgh, Pa.

TEXT OF STORY

Tess Vigeland: I mentioned earlier that the G-20 starts Thursday in Pittsburgh. Well a few months back, when the White House announced the city would host the most important economic summit on Earth, some in the media actually laughed.

Many folks think of Pittsburgh as a rust-belt relic that's been losing population for decades. Marketplace reporter and Pittsburgh native Rico Gagliano tells us how those losses affected the city and how it's bouncing back.


RICO GAGLIANO: Call me biased, but I say the best place in the entire universe is Jerry's Fine Used Records in Pittsburgh.

GAGLIANO: Jerry!

JERRY: Rico.

GAGLIANO: How are you?

JERRY: Slowly dying, being buried in vinyl.

Jerry's is one of the largest all-vinyl record stores on earth -- 2 million albums. And he's a living encyclopedia of classic girl groups.

JERRY: That's the one I'm talking about: "Who Do You Love." By the Sapphires. And I'm gonna play it for you.

Oh, the song is painfully appropriate. Who do I love? I love Jerry. And my parents who still live in Pittsburgh. I love the city's bridges -- most in America! The tons of museums and parks.

But in 1995, I left anyway. Followed by almost every friend I had. We young hipsters were the tail end of a migration that began over a decade earlier with steelworkers.

Chris Briem is a regional economist at the University of Pittsburgh.

CHRIS BRIEM: There were a lot of steel jobs here, and over the course of a few years in the early '80s it lost half the manufacturing jobs here. So 120,000, 130,000 jobs went away, and went away for good.

Briem calls it one of the worst -- if not the worst -- job losses suffered by any American metro region in the last few decades. When the jobs left town, so did hordes of the youngest, most mobile workers.

BRIEM: Fifty-thousand people a year. So many people lost over such a short period of time, we really wound up calling it the Vast Pittsburgh Diaspora.

The diaspora left a gaping hole where the city's tax base used to be. It left Pittsburgh with the second-oldest metro population in America, folks who weren't exactly culturally adventurous, which is one reason restless youngsters like me kept leaving and why Forbes magazine once ranked Pittsburgh the worst city in the USA to be single; there just weren't many young people around. Briem says in the late '90s, city marketers came up with a desperate ad campaign.

BRIEM: Advertising not to the world, but to ourselves. And it was gonna be a character named "Border Guard Bob." You know, dressed in a Smokey Bear hat, looked like a border guard, and he was gonna tell you young people why you should not leave Pittsburgh.

The ads never happened. And it turns out, they weren't needed. Because right around that time, Briem and others noted that though Pittsburgh still lost population every year, the rate of loss was slowing. Bill Toland writes a monthly column for the Pittsburgh Post-Gazette called "The Diaspora Report."

BILL TOLAND: This huge exodus left a much older population. Those people are dying now. The last 10 years I would say that is largely what's accounting for our population loss, not so much that people are leaving in droves.

In fact, the number of people coming and going is close to balancing out for the first time in decades.

TOLAND: A lot of the statisticians from around here are projecting population growth, starting in the next couple years and going out for the next 30 years.

In this town, that's headline news. But why is it happening? Economists have many theories. Pittsburgh's real-estate prices didn't inflate during the housing boom, so young families may be drawn by the prospect of a home they can actually afford. But most agree the biggest draw is something called jobs.

KAMAL NIGAM: This is our main office where we have mostly software engineers.

Kamal Nigam is a manager at Google Pittsburgh. The office is a far cry from the steel furnaces of this city's past. It looks kind of like a kindergarten.

GAGLIANO: Oh, there's a picture of Mr. Rogers, a Pittsburgh local.

NIGAM: That's right, so all of our conference rooms are named after various Mr. Rogers' Neighborhood characters.

GAGLIANO: Do you have a Mr. McFeeley?

NIGAM: We do.

The office opened in 2006 and employs over 75 people. Apple and Intel recently opened offices in this same building. Why? Well, Pittsburgh became a steel center because it had coal and rivers. It's becoming a tech and medical center because of another resource: its major universities.

NIGAM: You know, with the presence of Carnegie-Mellon here, there's good critical masses of excellent engineering talent.

In the '80s and '90s Carnegie-Mellon University ramped up its robotics and software-engineering programs. The University of Pittsburgh developed one of the top nonprofit health care systems in the country. Now companies like Google are setting up shop to tap into all that brainpower. Economist Chris Briem says the challenge will be keeping them here.

BRIEM: It's a tough question. Regions, you know, are all competing against each other in ways that they were never competing against each other in the past. Investment is hyper-mobile. It'll go wherever it's going to get the best return. The talent, the population, the people, they're ever-more mobile.

And if any city knows how fast a place can go from boom town to ghost town, it's Pittsburgh.

I'm Rico Gagliano for Marketplace.

About the author

Rico Gagliano is the host of Dinner Party Download.

A cable car on the Duquesne Incline, a funicular railway, climbs a hill overlooking downtown Pittsburgh, Pa.

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