Brookings Releases Southeastern Pennsylvania market assessment for growing opportunity industries and economic mobility

Situated at the intersection of the Schuylkill and Delaware rivers, the Southeastern Pennsylvania region- comprised of Philadelphia and the surrounding Bucks, Chester, Delaware, and Montgomery counties-represents one of the oldest and the largest metropolitan economies in the United States. Nearly 350 years after its establishment as a colonial center for global trade, agriculture, early manufacturing, and shipbuilding, the region is now viewed as a national hub for life sciences, health care, education, and professional services.

However, despite years of job growth, Southeastern Pennsylvania has experienced challenges in competing with high-performing peers such as Atlanta, Boston, and Phoenix. In particular, the region's tradeable industries (those that sell goods and services beyond the region's borders) failed to keep pace with national growth in recent years, therefore not fulfilling the region's productive potential and stifling wage growth. Had Southeastern Pennsylvania'stradeable industries matched their national performance, the region would have added over 104,000 more jobs between 2013 and 2023.

This jobs deficit has proven immensely consequential for the region's workers. Of the 104,000 jobs that Southeastern Pennsylvania would have added if it had kept pace with the nation, 70% would have been expected to offer opportunity for workers to support themselves and their families. Additionally, as growth in industries such as manufacturing and wholesale has eroded, Southeastern Pennsylvania's economy has become increasingly reliant on growth in non-tradeable ("locally serving") industries such as health care and hospitality, coupled with mild tradeable industry growth in advanced sectors such as financial services, where jobs disproportionately require a four-year degree. As a result, the regional labor market has become increasingly split down the middle between
high-wage and low-wage jobs, with pathways into the middle class becoming increasingly scarce, particularly for workers without a college degree.

The region's capacity to respond effectively is limited by structural challenges. Southeastern Pennsylvania is one of the most jurisdictionally fragmented areas in the country, yet its economy is highly integrated with shared industry strengths, workforces, innovation assets, and infrastructure that cross political boundaries and institutional responsibilities. Meanwhile, the region lacks a unified, tactics-level strategy and workplan to guide economic and workforce development efforts. This absence hinders the ability of stakeholders to prioritize, align, and coordinate actions for maximum collective impact. In contrast, leading peer regions rely less on public sector program delivery and more on business-led initiatives that offer greater flexibility and long-term commitment. These peers also
benefit from significantly better resourced regional economic development organizations, supported by clear operating agreements that define roles and relationships among partners for centralized or distributed functions.

In light of these challenges, Southeastern Pennsylvania leaders must align behind a shared strategy that leverages the region's immense economic, innovation, and human capital assets to create more middle-class jobs in industries where the region is well positioned to compete in the global economy. Growth trends over the past decade as well as qualitative engagement with business leaders and economic developers across the five-county region reveal three key industry clusters through which Southeastern Pennsylvania can chart this new path forward:

Enterprise digital solutions: Business-to-business software tools and customization services to optimize back-office and middle-office functions in operations, compliance, and strategy (such as "Business Process as a Service" and "Integrated Platform as a Service"), where historic regional strengths in technologies and
regulated sectors converge to spur applications for a range of both service and manufacturing industries.
Example firms: SAP, Boomi, SEI, Qlik, Citco, EPAM, Envestnet, InstaMed, Savana, Guru

Materials machining/fabrication and electronic components value chain: Production and distribution of precision metalworking and polymer components, industrial and process equipment, high-tolerance electronic connectors and instrumentation, communications systems and control devices, and related
assemblies, anchored by small- and middle-market firms.
Example firms: TE Connectivity, R-V Industries, Nicomatic, Rhoads Industries, Teledyne Judson Technologies, Acero Precision

Biomedical commercialization: Manufacturing diagnostics and therapeutics (including biologics) and medical devices-continuing a shift in emphasis from research and emerging technology platforms such as cell and gene therapy, as well as retaining more life science startups through early and growth stages.
Example firms: Janssen Biotech, Iovance, Globus Medical, GlaxoSmithKline, Trice Medical, TELA Bio, Axial Medical, DePuy Synthes

In sum, Southeastern Pennsylvania is strongly positioned to become more economically prosperous, resilient, and inclusive-but leaders in the region must adopt an opportunity-oriented mindset toward future growth and build new capacity for addressing challenges together. This report, which resulted from a multiyear collaboration among Southeastern Pennsylvania economic and workforce development leaders, provides the region with a shared rationale and evidence base on which to act in service of this goal. Through dedicated strategic partnerships, industry prioritization, and alignment between economic and workforce development partners, Southeastern Pennsylvania can chart a new path forward that reaffirms its centuries-long legacy of productivity, innovation, and prosperity.

Read the full report from Brookings, here.