Saturday, February 11, 2012

Pittsburgh Railroad Cluster

Pittsburgh is overly reliant on eds and meds. Shale gas can't save a postindustrial city in decline. A Pittsburgh that booms certainly can bust. It has happened before with steel. That's about the sum of the cynicism about the recent run of good fortune in Southwestern Pennsylvania. The goods times can't possibly last.

Pittsburgh is much more than eds and meds (e.g. finance) or shale gas (e.g. nuclear power). Introducing (at least for me) the railroad industry cluster:

The railroad industry is picking up steam again, after losing ground decades ago to the nation's trucking industry. And Pittsburgh's expertise and history in the business -- Andrew Carnegie and the city's other industrialists needed good ways to move their steel a century ago -- has put the region on track to benefit from rail's resurgence. ...

... It's no accident that so many railroad-related companies happen to be based in the Pittsburgh region.

The relationship between the railroads and the industrialists during the boom years of Pittsburgh's steel industry was a close one because railroads were so important in delivering steel and materials used to produce steel.

The rise of eds and meds did not displace legacy industries so much as it diversified the regional portfolio. Just so happens that right now, many sectors are swimming in the same positive direction. A shale gas bust (the current state of affairs) won't matter much to the Pittsburgh economic engine. Williamsport, PA is a different story. What happens there when the rush ends? At least residents there won't have too far to move to find jobs.

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