The problem of Pennsylvania foreclosures, coupled with high unemployment rates, is creating economic stress among the state's residents and businesses. According to the latest Associated Press (AP) report on economic conditions around the U.S., Pennsylvania is among a handful of states that posted increased economic stress during the month of May.

The number of bank foreclosures, Freddie Mac homes and other foreclosed properties in the state remains high, but this is not the only reason why Pennsylvania made it to the list of states that recorded the highest increase in economic stress for the month. Unemployment rates also played a major role in depressing Pennsylvania's economy.

According to the AP report, the state's economic problem is not solely pegged on foreclosed properties or Fannie Mae homes, but has a lot to do with the slowdown of chemical manufacturing in the area. Pennsylvania recorded a 10.49 economic stress score for May 2010. The score is derived from bankruptcy, foreclosure and unemployment rates.

The AP report also showed that almost 70% of counties in the U.S. became healthier economically during the month of May. This is mainly due to these counties' declining home foreclosure listings and more jobs in their manufacturing industries. The improvements are mostly apparent in the Sun Belt and Midwest areas.

Locally, Pennsylvania foreclosures did not exhibit the same decline as did most states that were categorized as economically improved. The report showed that despite the high percentage of U.S. counties enjoying some form of economic recovery, the pace of nationwide improvement slowed somewhat when compared with April numbers. Economists have stated that this could be a signal that the country's economic recovery is losing its momentum.

Another concern for economists is the increase of bankruptcy rates all around the U.S. during the month. According to them, a definite economic recovery is still not possible, especially since the labor market is still weak and not while government stimulus programs are winding down. They speculate that although the economy is unlikely to go back to the same level of recession of a year or so ago, its growth will not be too fast either.

Despite the fact that unemployment and Pennsylvania foreclosures are preventing the state from achieving a low score in the economic pressure level, local housing market analysts believe that Pennsylvania is still better off than other states, particularly those areas hit hardest by the Gulf of Mexico oil spill.

Original Post: Pennsylvania Foreclosures and Unemployment Impact State Economy on BankForeclosuresSale.com.