This article was published originally on March 23rd, 2011 at 11:53 PM EDT. THE CITY
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The CITY’s March economic recovery update is here. We publish a new analysis of the city’s employment, job and fiscal indicators each month.
New York City’s recovery from the pandemic is almost complete, according to recently updated job numbers from the state Labor Department.
The city gained a little more than 20,000 jobs in January and February — many in the leisure and hospitality sector.
New York has regained 96% the jobs it lost during the pandemic.
https://www.datawrapper.de/_/KsO4V/
Overall, the city’s jobless rate inched up to 5.4% in February, from 5.3% in January.
People are only considered unemployed if the person has actively searched for work over the last month. Economists view a decision not to job-hunt, as an indication that the workers who have been on the sidelines believe that they can find work.
https://www.datawrapper.de/_/yBc4C/
The increase may also indicate that fears of catching COVID are ebbing and that child care is more available — two pressures that kept New Yorkers from seeking employment.
The city’s workforce has increased by 40,000 in the past 12 months and the labor force participation rate is at a decade-long high at 61.7%.
NYC Bank Crisis
Nonetheless, the city faces two significant headwinds — a short-term one from the bank crisis and a longer-term challenge as businesses embrace technology as a way to reduce their payrolls.
Economists believe there is no way of knowing if the bank crisis will cause a collapse in the strong economy. This is mainly because banks will have to enforce stricter lending rules, which will slow down growth.
Locally, the crisis has already resulted in the closing of Signature Bank — a key real estate lender in New York, especially to rent regulated apartment buildings.
The forced merger of Swiss financial giant UBS with Wall Street firm Credit Suisse means that Credit Suisse, which employs thousands in the city, will likely be reduced drastically.
Prepare for Automation
Even if the bank crisis is resolved it may prove difficult to restore the strong job growth that the city experienced after 2008. It added an average of 90,000. jobs per year.
Consider two examples.
Soon Alfredo Angueria will open his fourth restaurant in The Bronx — but this one will be different.
Bodega Social, a Tex Mex restaurant, will have only three employees. Customers can place orders via their smartphones. Customers will order on their phone when they arrive at the restaurant.
“I have to get by with fewer people,” Angueria said.
Stephan Steiner, the founder and president of GSB Digital, just spent $1.5million on a HP printer. This was in Long Island City, Queens. He is expecting to earn about $13.5million this year, which is about the same as 2019. However, he has 80 employees instead of the 100 that he had before the pandemic.
“We are trying to do whatever we can to automate,” Steiner said.
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In 2018, the Center for an Urban Future published a report that claimed that technology was threatening nearly half a million New York City jobs. A follow-up study in 2021 said that those positions were primarily held by people of color — with 51% of Hispanic men aged 18 to 25 holding vulnerable jobs, as do 48% of black men the same age, the highest of any group.
https://www.datawrapper.de/_/2DuIx/
“It seems pretty clear that employers faced with rising labor costs and all sorts of disruptions from the pandemic are reluctant to return to 2019 levels,” said Eli Dvorkin, editorial and policy director at CUF.
He points out that this is especially true for struggling industries such as restaurants and hotels. “But increasingly automation isn’t unique to those industries. Back office, administrative and accounting are areas where technology is allowing more work to be done by computers,” he added.
That’s clear on the factory floor at GSB Digital, where operators at even some of the company’s basic machines use a computer to control their machines. While starting pay is around $20 an hour, those operating the most expensive and sophisticated machines can make more than $75,000 a year, Steiner said.
Given New York’s high costs for labor, he feels compelled to increase his use of automation. A major contract was awarded to him but he lost it because the customer wanted lower wages in Pennsylvania.
Angueria is obsessed with labor costs. Since the pandemic, he has had to raise the wage he offers to $20 to keep his workers employed at his restaurant group. It is located near the Bronx Drafthouse and Yankee Stadium.
The Drafthouse bartender also serves as server on Mondays, which are usually slow. If business is slow than expected, he will respond quickly.
“We keep an eye on sales on an hourly basis, so if it looks like it’s a slow day, I am cutting staff almost immediately,” he said.
Dvorkin of the Center for an Urban Future says the loss of jobs will be offset by new jobs created or augmented by technology — but that too many New Yorkers are not prepared for those positions.
“It raises the floor for the kinds of computer and digital skills New Yorkers are going to need,” he said.
Dvorkin and other experts are eagerly awaiting a long-promised report from the administration of Mayor Eric Adams to outline how to overhaul the city’s workforce programs. Tens of thousands of graduates of New York City school don’t have the most basic knowledge needed to land even an entry-level job at a company like GSB Digital.
“The mayor needs a bold strategy to upskills New York’s workforce to become better prepared for a new economy, one that focuses on making digital and basic computing skills as fundamental to an education as numeracy was in the past,” he said.
Grand Central Madison will boost office occupancy?
With office occupancy stuck at 50% on a typical workday in the New York region and about 65% at the city’s most modern office buildings, Midtown Manhattan leaders are hoping the opening of the Grand Central Madison station serving the Long Island Railroad will give a boost to the neighborhood.
https://www.datawrapper.de/_/CQMpX/
According to the MTA, just over 50,000 people used the station in the first week of this week. According to data from the Grand Central Partnership, there was a 25% rise in the number of Long Island ZIP code residents who visited Grand Central Terminal compared to before it opened.
“Those people will come and spend money in the neighborhood and help invigorate our retail,” said Fred Cerullo, president of the Partnership, at an event touting transit investment in the neighborhood this week.
He pointed out that in 2022, 89 new retail outlets were opened on the Grand Central Partnership territory, mostly food and drink places. Another 35 are being constructed now.
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