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Pennsylvania State University is the largest single employer in the State College area, with more than 27,000 full- and part-time workers, and ranks as the seventh largest employer statewide, contributing over $15.8 billion to Pennsylvania's economy and supporting nearly 110,000 jobs. Penn State Health adds a further $7.3 billion in annual economic impact. Other major regional employers include Mount Nittany Medical Center, AccuWeather, the federal government, the YMCA, Wegmans, and Raytheon.

Downtown's Innovation Hub, an 85,000-square-foot facility on South Burrowes Street, houses Happy Valley LaunchBox and supports early-stage startups with prototyping labs and event space. Separately, Innovation Park, a 118-acre research and business campus adjacent to campus, hosts more than 60 companies including the National Weather Service and law and technology firms. The downtown business district itself runs roughly from Atherton Street to Sowers Street.

With Penn State anchoring employment and a rotating population of students, faculty, and researchers, State College sustains steady demand for local services tied to housing turnover and campus-adjacent life: property management and rental-focused plumbers and electricians, dental and medical practices serving both university staff and Mount Nittany Medical Center patients, and legal services supporting the startups clustered at Innovation Park and the Innovation Hub.