PNC Über Alles

Who is king of downtown Pittsburgh? UPMC has practically and metaphorically taken over the regional economy with its new crown sitting atop the U.S. Steel Tower. Last month, PNC announced a new skyscraper. Golden Triangle gains might come at the expense of Raleigh and Rocky Mount, North Carolina. PNC Financial is buying RBC Bank:

Such a deal likely would trigger significant job cuts and would be another blow to Raleigh and its economy. Raleigh already is poised to lose Progress Energy's downtown headquarters when the Fortune 500 utility completes its pending merger with Charlotte-based Duke Energy.

In October 2008, RBC moved its U.S. headquarters to RBC Plaza at Fayetteville and Martin streets. The move signaled Raleigh's shift to something more than a government town. ...

... "This is a north-of-the-Mason-Dixon-line bank combining with a south-of-the-Mason-Dixon-line bank," said Tony Plath, a finance professor at UNC-Charlotte. "It's a combination that takes PNC out of its current existing footprint, and that's going to preserve more jobs.

"But let's face reality: There are going to be job losses."

Plath predicted that, in the Triangle, PNC would eliminate 150 to 200 administrative jobs - including all the senior executives and the people who answer to them.

"What I'm really concerned about is the operations center in Rocky Mount," Plath said. "Will they keep that or will they let that go? That's a wild card."

RBC has more than 1,000 employees in Rocky Mount, a holdover from when the bank was headquartered there.

The majority of those employees are involved in functions such as information technology and mortgage processing.

If PNC decides to consolidate those functions in Pennsylvania, "that would decimate Rocky Mount," Plath said.

To sum up the story more succinctly, the Rust Belt's gain is the Sun Belt's loss. Talk about a dramatic reversal of fortune. The two North Carolina downtowns are heading in the opposite direction of Pittsburgh's revitalization.

That anecdote is how I would define the economic reset of the Great Recession. Returning to the US Conference of Mayors report I referenced last night, Table 1 details the gross metropolitan product (GMP) of U.S. metro areas (US$, billions) for 2007-2010. In 2007, Tampa stands at 114.1 and Pittsburgh chimes in with 108.2. Tampa's economy was bigger than Pittsburgh's. The two switch places in 2009. By 2010, Pittsburgh stands at 115.6. Tampa? 113.9. Over the four-year period, Pittsburgh grew and Tampa shrank enough to switch places in the GMP rankings.

Read more about this transformation at Chris Briem's Null Space.