A Bite Out of the Big Apple: New York in Recovery
The New York metro area is still struggling, in spite of a strong economic contribution from its technology and finance industries, most notably Wall Street, that performed well and even grew during the pandemic. The catastrophic initial job losses from the pandemic and related lockdowns, population loss and low office utilization continue to slow the city’s return to pre-pandemic employment even though it has added 131,000 jobs since January. That is second highest gain behind Los Angeles and more than double the third-place market.
Hover over the interactive graph below to view the change in New York employment compared to national employment.
The area lost 108,135 residents from 2019 – 2020, including those who had the financial means and work flexibility to relocate or work remotely fled the city to escape the virus’s impact. Others left for economic reasons. At this point in time, it is not anticipated that those who moved out will be coming back.
Based on data from Google Mobility Reports, foot traffic within New York County - home to Manhattan - is down over 50% on business days, as is subway ridership. This lower level of in-person, work-day activity has critically impacted the vendors and restaurants that service the commuters and office workers, contributing to the job recovery plateau. Commercial real estate is also feeling the impact as owners of under-capacity office space are having to restructure leasing contracts to be more favorable to future workspace requirements.
One in three workers in the New York area work in either the Education and Health Services or Leisure and Hospitality industries. These industries have suffered severe consequences and economic fallout through the pandemic and will take longer to recover jobs than in other markets.
The area’s overall employment level is still down -10.2 % from pre-pandemic employment levels, with an unemployment rate of 7.5% in May, higher than the national average. In this market a large portion of the unemployed come from jobs that require face-to-face, service-based interactions that are only now starting to return at a slow pace.
Why It Matters
While New York will always have its place as a main hub for U.S. commerce, the business landscape has evolved.
Many remote workers will not return to the office, even those who reside in the city or nearby boroughs. Educational Services will see a return to more normal employment levels once schools resume back to in-person, in the fall.
Talent acquisition professionals across the New York metro will face challenges attracting new workers and job seekers to in-office roles, requiring businesses to remain flexible through the recovery period ahead.
Employers seeking hourly workers in Leisure and Hospitality may have continued challenges. Although mobility indicators show some increase in traffic for these services, managers still have to contend with slower work week business. This may also make it difficult for workers to find opportunities that don’t leave them underemployed.
LaborIQ® by ThinkWhy forecasts the New York market to recover in 2025, behind the overall national employment level. Some industries in the area will recover earlier such as Financial Activities projected to recover in 2022, while Professional and Business Services will return to pre-pandemic employment in 2024.
LaborIQ by ThinkWhy continuously forecasts and reports labor data at all levels, measuring impact to cities, industries, occupations and business across the U.S.