Despite the pandemic, Berks County’s economy is anchored to a firm foundation

As reliable as Pennsylvania Dutch Country soft pretzels, economic growth in Berks County continues to increase at a stable pace.

Trucking, logistics, distribution, manufacturing, health care and agribusiness are long-standing contributors to Berks County’s strong economic landscape – even during the Covid-19 pandemic crisis.

Logistics and distribution access points from Interstates 78, 422 (east/west) 222 and 61 (north/south and central) along with the Pennsylvania Turnpike provide nationwide brands like Pet Smart to serve consumers from Berks County hubs. 

“These corridors have become a large component for us,” for growth and job balance, said Pamela Shupp Menet, vice president of external affairs for Greater Reading Chamber Alliance. She said facility sizes had increased along those distribution routes, providing services throughout the northeast corridor and beyond. Despite the governor’s shutdown order in March, the employment base was strong heading into 2020.

Because many Berks businesses were deemed essential under the order, unemployment has been lower than in other area communities. According to a recent press release by the Pennsylvania Department of Labor and Industry, February’s unemployment rate was 4.6 percent in Berks, significantly lower than the state average of 6 percent in March. 

The county’s labor force grew 9 percent between 2000 and 2018, according to the Berks County Community Foundation. During roughly the same period overall jobs number grew 11 percent. While the report concluded manufacturing jobs were down during that time, health care and social services employment jumped by 62 percent.

Meanwhile, partnerships with Kutztown University’s Small Business Development Center, Ben Franklin Tech Ventures at Lehigh University and the Jump Start Incubator within Berks County Community Foundation are providing launch pad services for entrepreneurs and small businesses.

West Reading on the rise.

New mental health facilities anticipated as part of the Tower Health/Drexel University project in West Reading could provide office space and resources for associated businesses, health care entrepreneurs and start-ups. 

“With Tower teaming up with Drexel, that will spark some of the incubator things in and around where they are building the school,” Shupp Menet said.

The Tower Health/Drexel campus building broke ground last June on the site of the former Knitting Mills. The roughly $70 million redevelopment goal of the former Berkshire Knitting Mills is to attract professional talent and newcomers to live and work in and around West Reading, she said.

Agriculture continues to be a solid Berks economic driver.

“Over the years agribusinesses have become a much bigger portion of our loan requests – certainly in the past three years,” Shupp Menet said. 

Prior to Covid-19 restrictions the agriculture sector accounted for roughly 43 percent of loan inquiries. GRCA administers the Pennsylvania Industrial Development Authority loan program in Berks County.

“Since 2017 there have been 21 agribusiness financing projects in Berks County totaling $22.5 million and supported by $8.1 million in PIDA loan funds,” Shupp Menet said. During the past two years, those loans have been going to expand existing farms. 

Agribusiness includes crops, poultry farms and related businesses that support growing and farming operations. Many farming operations continued to be family-owned and operated. 

Successful transitions to the next generation are also adopting newer technologies, she said.

Manufacturing jobs remain in demand during the pandemic as some businesses convert production lines to make personal protective equipment (PPE) such as face masks and gowns, and hand sanitizer. Business expansions, new facility construction projects, along with businesses relocations were all up before Covid-19.

There is concern and uncertainty over government ordered shutdowns once construction projects resume. “Those businesses [moving to new buildings] would need to also be deemed essential in order to open, too,” she said. 

Residential housing starts decline.

Residential housing starts, a sector which was down prior to Covid-19, continued to be slow.

 “Housing has just not picked up in Berks County,” said Michelle Franklin, a subdivision and land development senior planner at Berks County Planning Commission.

From Albany to Wyomissing Heights there were 92 new single-family housing starts reported in the fourth quarter of 2019. Since the end of February few new housing applications have received.

Franklin attributes poor housing starts to an old county-wide tax reassessment from 1994 that placed a higher tax burden on new home buyers, rather than fears over Covid-19.  “Housing starts have been down since the 2008 recession, and we never really came back from it,” she said.

Buy local trend could be next

Shupp Menet made a post-Covid prediction: “…a lot of communities will see a very large push to buy local, and not just restaurants and professional services.”

Creating and supporting a regional supply chain in the post-Covid recovery could become a factor in continued growth. 

“As we begin our conversations around what recovery looks like for us, I think that will be a big push,” she said.

Jason Brudereck, director of communications for Berks County Community Foundation, is optimistic there will be opportunities after the pandemic is past. “Some will close, but others will step in…small businesses are the job creators in any community,” he said.