Labor Data: New York Finance Sector Trends Down
ThinkWhy It Matters
Like San Francisco, New York City builds up versus out, due to land boundary limitations. Employers will continue to see wage pressures as the cost of living increases, forcing both employees and employers to move to lower-cost areas.
New York City is the single largest regional urban economy in the country and the leading job hub for banking, finance, and communication. It also supports a major manufacturing center, international shipping port and has a thriving technology sector.
New York City’s monthly job gain picked up in June 2019 to 9,400 jobs, after losing 5,300 jobs in May 2019. Compared to the five-year history, annual job growth in June 2019 saw a moderate drop of about 80 basis points (2.1 percent versus 1.3 percent or ~57,000 jobs). The pace of monthly job gains started slowing in April 2019 and is now on an average annual pace of 92,000 jobs as of June 2019.
During optimal economic conditions, the metro area can produce over 185,000 jobs annually. The unemployment rate in May 2019 remained similar to May 2018 at 3.7 percent but increased about 30 basis points compared to April 2019.
“New York City is experiencing its largest and longest job expansion since the end of World War II and the city has been the driving force behind the state’s employment gains,” states Thomas DiNapoli, New York State Controller. “While job growth remains strong, there are national and global risks that could affect the pace of future growth.”
• With a similar unemployment rate as the national average of 3.7 percent, the wage growth in the metro area is robust at 5.4 percent compared to 3.1 percent wage growth nationally.
• Education and Healthcare industries led the pack on the job growth in the metro area at 4.8 percent.
• Tech jobs grew 2.3 percent.
• Leisure and Hospitality is holding its own and producing job growth similar to the recent five-year average.
• The Financial industry is a concern, losing jobs during June 2019, as the metro area has an abundance of high paying jobs in this sector
Expect to see single-family demand outpacing supply in the New York City metro area as supply in this area is constrained by zoning and buildable sites. However, multi-family supply (including condos and co-ops) is outpacing demand putting downward pressure on prices.
The pace of multi-family permits remains near the historical average, but demand is expected to slow in the coming months. Rent control legislation may reduce housing costs for employers and relocating employees in the short term.
Gain more insight into employment statistics, including job growth and hot and cold employment sectors, with ThinkWhy's Major Market Activity Report for June 2019.