CNYCA’S COVID-19 Economic Update: Job market behavior in a pandemic—no easy answers

Disclaimer: Content in this article was obtained from NYC Employment + Training Coalition’s (NYCETC) NYC Workforce Weekly and the Center for New York City Affairs (CNYCA) to serve as a resource for job seekers and those who are curious/interested in learning more about the current economy of the workforce.

Source:
Original article HERE / Past installments on CNYCA’S COVID-19 Economic Update HERE


We’ve all seen the “Help Wanted” signs in the windows of our neighborhood businesses. It’s a reassuring sign that business is coming back, and that our sequestered days might be waning. On the other hand, how can it be that jobs are going unfilled when we know that three-quarters of a million New Yorkers are jobless or have exited the labor market over the past year?

Many businesses are right to ask whether the extra $300 in weekly unemployment benefits available through September 6 is keeping workers home. But as journalist Greg David noted in a recent article in The City on this issue, “it’s complicated.” David cited a recent Brooklyn Chamber of Commerce survey in which 42 percent of businesses felt that federal unemployment benefits were discouraging return to work. Yet, the Brooklyn survey, according to a report in the Post, also found that 41 percent of businesses said they couldn’t provide enough hours to employees, 28 percent said employees had moved on to other jobs, workers had safety concerns in 12 percent of the cases, and employee health issues were cited by five percent of businesses. And several businesses also noted that lack of child care was keeping some workers home.

Clearly, a multiplicity of factors is influencing job market behavior as pandemic business restrictions are eased, Covid case rates decline, and vaccinations become more widespread. It is not so clear cut that unemployment benefits are the primary cause for some jobs going unfilled, although the availability of benefits likely does make it possible for many of the unemployed to exercise greater latitude in making decisions in the best interests of their families, personal health, and career choices. But isn’t that appropriate considering that the unemployed lost their jobs due to a public health emergency not of their making, and that the pandemic has upended livelihoods and family circumstances for millions?

Beyond survey perceptions there are various economic indicators that reinforce the notion that there are no simple or easy answers on this question. Even though an earlier $600 weekly federal unemployment supplement ended at the beginning of August last summer, there was no local job surge in ensuing months. Rather, the second wave of Covid infections beginning in October kept the city’s overall job level flat for several months. Jobs didn’t start to rebound strongly until February and March (NYC added 90,000 jobs over those two months), even though the new $300 weekly federal supplement began in early January.

Employment in restaurants—where unfilled job openings are most common—rebounded some in the fall, fell off again during the winter, and started hiring again in February. This erratic pattern may have signaled an instability that deterred workers from returning. (April payroll data for New York City will be released on May 20.)

The fact that employment in child care centers has not risen appreciably since November also supports the notion that the lack of child care capacity has been preventing some parents from returning to work. The March 2021 employment level was still 21 percent below the pre-pandemic level, and there was a severe crisis in child care accessibility and affordability before the pandemic. The very slow pace with which the State has been moving to disburse emergency federal child care funding has further exacerbated the child care situation.

Since most neighborhood businesses are not back to full capacity, many are not able to offer their employees full-time schedules. Unlike other states, New York State’s partial unemployment system is particularly antiquated and confusing for workers to navigate. There are “cliff effects” as the figure below indicates, where an additional hour of part-time work can dramatically reduce partial unemployment benefits, unduly complicating a worker’s decision about returning to work part-time. State legislators and the governor have had proposals to remedy the problem since January but have not yet reached agreement on a resolution. Meanwhile, an estimated 25 percent of the two million-plus UI recipients in New York State are receiving partial benefits.

Several news reports indicate that some restaurant businesses have raised pay offers or enhanced benefits to attract workers back. That is what labor economists would expect to happen when recruitment problems persist. The need for higher pay is particularly warranted given that New York State pay regulations permit a “subminimum wage” for tipped restaurant workers of $10 an hour whereas the wage floor for most New York City workers has been $15 since the beginning of 2019. Since most restaurants are far below pre-pandemic business levels, tips are likely a fraction of what they previously were.

CNYCA’S COVID-19 Economic Update: NYC jobs resumed their return in February and March after a flat four months

Disclaimer: Content in this article was obtained from NYC Employment + Training Coalition’s (NYCETC) NYC Workforce Weekly and the Center for New York City Affairs (CNYCA) to serve as a resource for job seekers and those who are curious/interested in learning more about the current economy of the workforce.


James A. Parrott, the Director of Economic and Fiscal Policies of the Center for New York City Affairs (CNYCA) at The New School has prepared the latest report of NYC’s economy issued February 2021.

New York City lost 750,000 payroll and self-employed/independent contractor jobs on average between the months of February and December in 2020. The loss for the entire year was the worst single-year city job decline since the 1930s. The partial rebound since last spring has been called a K-shaped recovery for good reason; many in the bottom half of the economy have lost jobs or earnings and are experiencing severe housing and food insecurity, while most of those in the top half of the income distribution retain their jobs, and many have seen their financial assets rise in value. Signs of serious economic distress are multiplying, long-term unemployment is skyrocketing, many of the new jobs emerging are lower quality than the jobs that have been lost, and many of those returning to jobs are only working part-time. The city’s underemployment rate is 25 percent. This report examines the Covid-19 economic and employment impact in New York City at the end of January 2021, assesses the several labor market challenges for the year ahead, and discusses how much and what kind of job growth the city can expect in the year ahead. The report looks at the demographic and industry contours of the job market effects and investigates how the pandemic has exacerbated wage and income inequality.

James A. Parrott

Like the national picture to some extent, jobs have resumed returning in a handful of New York City industries in the past two months. The latest New York City jobs numbers released on April 15th showed a 40,000-gain in March and the February numbers were revised upward by 12,000, to show a 48,000-job gain over January. This follows four months of backsliding after an initial rebound during the late spring and summer months of 2020 from the low point reached last April. Still, the city’s payroll job count remains 585,000 below the pre-pandemic level.

New York City’s 12.5 percent jobs shortfall from pre-pandemic levels is two-and-a-half times the nation’s five percent falloff from February of 2020 to March of this year. Job losses in the city have far exceeded those in the rest of New York State where the decline over the past 13 months has been 7.6 percent. Sixty percent of New York State’s pandemic job losses have taken place in the city, which accounted for 48 percent of all Empire State jobs before the pandemic.

The table below shows the detailed New York City industries sorted into the three categories useful for analyzing the pandemic economy. It indicates the monthly job gains for February and March of this year as well as the extent to which the February-to-April job collapse in the early days of the pandemic has been made up in the months since. Even with the moderate gains in the past two months, New York City has only recouped 37 percent of last spring’s job losses. Only a little more than a third (35 percent) of the 725,000 job losses sustained in the face-to-face industries have been regained. 

While every industry had either job gains or very small declines in March 2021, only six industries had significant job gains in February and March, accounting for over 80 percent of the net job increases during those two months. Food services and drinking places added back over 23,000 during the two months (but were still down by 140,000 compared to last February). Private colleges and universities (part of the private education industry) and local government brought back workers (16,000 and 10,000, respectively) over the past two months after cutting headcount in December and January as the second Covid-19 surge spread. Home health services (within health care) added 8,200 jobs, temp agencies (within administrative services) 8,100, and motion picture production (part of information) 6,100 jobs, with all three industries reaching their highest levels since the widespread pandemic cutbacks. 

The remote-working industries have been much less affected by the pandemic than the face-to-face industries, with a net decline of 6.4 percent vs. 23.5 percent in the face-to-face industries. Nevertheless, finance and insurance has reduced employment slightly since last April and the job rebound in professional, scientific, and technical services has been only six percent. Health care, on the other hand, has regained 88 percent of the job reduction experienced between February-April 2020.

CNYCA’S COVID-19 Economic Update: NYC job losses proportionately greatest among largest U.S. cities

Disclaimer: Content in this article was obtained from NYC Employment + Training Coalition’s (NYCETC) NYC Workforce Weekly and the Center for New York City Affairs (CNYCA) to serve as a resource for job seekers and those who are curious/interested in learning more about the current economy of the workforce.


New York City’s Covid-19 payroll job loss was 13.6 percent over the first year of the pandemic, more than twice the 5.9 percent national job decline and greater than the job losses experienced in the next 14 largest U.S. cities. These data reflect the annual revision to the monthly establishment payroll employment data that was released by the New York State Labor Department on March 11th (see next item below). San Francisco’s 13.2 percent job loss and Los Angeles’ 12.1 percent decline were close behind New York City’s. The next five cities – Philadelphia, Boston, Miami, Washington, D.C., and Chicago – were clustered in the -9 to -10 percent range. Four cities among the 15 largest in the country – Riverside (CA), Atlanta, Dallas, and Phoenix – had smaller job declines than the nation overall.

The New York City metropolitan area had 9.9 million jobs in February 2020, or 6.6 percent of the 151 million national job total. During the pandemic’s first year, the metropolitan area had an 11.2 percent job decline; the rest of the metro area outside of New York City saw jobs fall off by 9.1 percent compared to the city’s 13.6 percent decline. New York City had 3.1 percent of all U.S. payroll employment as of February 2020. 

The Labor Department’s revised payroll employment data also revealed that New York City’s job losses in 2020 were greater than previously reported. In our February 12th report, New York City’s Covid-19 Economy Will Not Snap Back, we wrote that the February-December 2020 payroll job loss was 507,000, a decline of 10.9 percent. The job level for last December has now been revised downward by the Labor Department to show a drop of 575,000 from February, a revised job falloff of 12.3 percent. The annual revisions are based on administrative data compiled in connection with the payment of employer payroll taxes for unemployment insurance purposes. (The employment figures cited here are not adjusted for seasonal effects since pandemic-related impacts have been much greater than the usual pattern of seasonal ups and downs.)

The January employment levels dropped further because there had been some seasonal hiring in November and December that then ended. Even with a moderate 40,000 increase in February employment levels, the February 2020 to February 2021 New York City change shows a drop of 635,000 jobs, or 13.6 percent. The table below shows these 12-month job changes for individual industries grouped into the three categories (Essential, Face-to-Face, and Remote-Working) we feel best reflect the predominant dynamic caused by Covid-19 economic impacts. 

The revised data underscore the now-commonplace observation that the Face-to-Face industries have borne the brunt of the adverse pandemic economic and employment impacts. Led by the steep job losses in leisure and hospitality and the arts and entertainment industry, Face-to-Face industries as a group have seen a 25 percent drop in employment compared to a seven percent decline in the Remote-Working industries and a slight three percent decline in the Essential category. Nearly four out of every five New York City jobs lost over the past year have been in the Face-to-Face industries, where most workers do not get paid if they don’t work and where only a tiny fraction of workers can do their jobs remotely.

The annual employment revision saw a handful of industries with significant downward revisions while a smaller number of industries had upward revisions. Two of the hardest-hit industries had sharp downward revisions: hotel employment was revised down by 44 percent and eating and drinking places had a 12 percent downward revision. On the other hand, the other among the three hardest-hit industries –arts, entertainment, and recreation – had a 44 percent upward revision in its job numbers. However, as the above table shows, this industry still suffered a 51 percent job loss over the past year.

Child care employment was revised down by 21 percent and the revised job levels for temporary employment agencies were 30 percent lower. It had earlier been thought that given its essential role, employment had been fairly stable in grocery stores and drug stores; however, the more definitive administrative data resulted in a 10 percent downward revision in the number of grocery store jobs and a 17 percent negative change in drug store employment. There was a surprising upward revision elsewhere in the retail sector, with clothing store employment revised up by 43 percent. Among upward revisions in the Remote-Working industries, employment in publishing was reported to be 10 percent greater in the revised data, and there were upward revisions of five percent in investment banking, six percent in computer services, and eight percent in management consulting.

The Lantern House | 4 Stories Development

The Head of Business Development at 4 Stories, the Marketing and Consulting Division for New Developments at LG Fairmont, Leah Azizian speaks about The Lantern House, “an exquisite project in West Chelsea that was developed by Related Companies. The Architect on the project was Heatherwick Studio & the Interior Designers (also British Influence) were March and White Design.”

Data used in this video is from MarketProof New Developments

Now what I love about Heatherwick Studios’ vision here is that he was inspired by the big windows in the Victorian homes in the UK. So he wanted to create a project that essentially when you are standing by the windows, you almost feel as if you’re immersed in the city and in the skyline of New York City.

Last week, we spoke about 124 West 16th Street – which is another project in Chelsea that managed to sell out in one year. This week, we’re going to speak about the Lantern House.

Since July of 2020, they’ve managed to put over 40 units into contract. Keep in mind that Chelsea is a neighborhood that’s extremely congested. There is over 750 units available amongst new developments for sale, and over 580 units in just West Chelsea alone. So let’s dive into what makes this project stand out from them all.

Tell me the specs…

The Lantern House is a 2 tower project that’s comprised of 180 units – mostly of one bedrooms and two bedrooms. The one beds are starting at $1.4 million, the 2 bedrooms are starting at right under $2 and a half million, and there’s an average offering price per square foot of right under $2,750.

What’s so awesome about The Lantern House is that the 2 towers actually connect right underneath the High Line, which is an area that’s been seeing a ton of development in the past few years and a lot more to come.

Another awesome feature about The Lantern House is that they offer purchasers the choice between a darker finish and a lighter finish.

Finishing thoughts …

Overall, The Lantern House has a handful of unique qualities that really stands out from them all. The first being the facade. It leads us to question, “Should we be seeing more projects being built with unique facades in the years to come?” and also, “Should buyers have more of a hand in their finishes and more of a choice in what’s going to be installed in their home?”


If you have any questions for Leah regarding New Developments, learning more about the real estate field, or even working in the real estate field, please reach out to her via LinkedIn or lazizian@lgfairmont.com!
LG Fairmont is hiring a Licensed Real Estate Salesperson and if you have an entrepreneurial mindset, then you may be the ideal candidate. Don’t miss out on this great opportunity!

New Development Spotlight of the Week – featuring MarketProof Data

According to the Head of Business Development at 4 Stories, the Marketing and Consulting Division for New Developments at LG Fairmont, Leah Azizian states that “there were only a handful of projects that saw major success. And, one of these projects was 124 W 16th Street in Chelsea.” Watch her video more below to learn more about this project.

Data used in this video is from MarketProof New Developments

124 West 16th Street is a 15-unit, 11 story building that was officially launched in February of 2020 – exactly one year ago. And just this past month, they sold out on all their units. Twelve months! Keep in mind, we went through a pandemic where from March through June, they weren’t able to do in person showings. They managed to sell out their building completely.

Why is this so remarkable?

Almost every feature about it was kind of rooting it against itself. The developers bought it in 2012. They acquired from the church which is right next door, which they ended up actually building above. But they bought it in 2012. I’m sure it wasn’t their intention to launch a building during the year of 2020, and when you look at the building specifically, you’ll find that the majority of the 15 units… 9 of the 15 units are 4 bedrooms or more. Square footages were starting at 1,500 square feet. The average selling price according to MarketProof was over $2,600, with the average price of $5.8 million, so this takes a very specific buyer. And usually in buildings like this where they’re luxury buildings – especially boutique buildings, we see a lot of international buyers flooding the gates and acquiring these properties. But considering that we weren’t able to have these type of buyers coming in, it’s so incredible to see that regardless, they were able to sell out completely in one year.

So how did they do it?

Every single one of these units have these gorgeous, great rooms with fireplaces. Every single one of the units featured private outdoor space, no more than two homes on every floor share a private elevator landing. They couldn’t have launched this building in a more perfect time. They launched a building that checked off the boxes of every single buyer during COVID. And because of that, they were incredibly successful with their launch.


If you have any questions for Leah regarding New Developments, learning more about the real estate field, or even working in the real estate field, please reach out to her via LinkedIn or lazizian@lgfairmont.com!
LG Fairmont is hiring a Real Estate Salesperson and if you have an entrepreneurial mindset, then you may be the ideal candidate. Don’t miss out on this great opportunity!

The MTA Is Expecting To Lay Off Thousands of Workers and Cutting Services in Mid-December

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Around mid-March when the NYC lockdown happened due to the highest cases, subway riders have descended rapidly to over 90 percent. As the phases slowly reopened in the recent months, subway riders still remained below 70 percent compared to pre-pandemic. Road traffic, including the tunnel and bridges have plummeted significantly throughout the months.

MTA service reduction and layoffs are all dependent on the federal government’s funding and the economic activity across the New York County. The MTA is expected to lay off at least more than 9000 workers if they do not receive any significant amount of funding because they need $12 billion in federal emergency funds to keep the system running as is.


According to Fox5, NBC (Source 1) and (Source 2), and CBS, below are the statistics:

  • “MTA officials have asked Congress to cough up $12 billion in federal aid by the end of 2021 to stay afloat.”
    • “The MTA has been asking for a bailout from the federal government. It did receive $4 billion in stimulus funds, but for the additional $12 billion to be approved it would likely need to pass through the Senate.”
  • “Some of the other cuts will reportedly include laying off more than 8,200 workers on subway and buses… and more than 1,100 Metro-North and LIRR employees.”
  • “Some weekend service would be slashed entirely while weekday train schedules would be cut by about 40%.”
  • “Fare hikes are also a possibility. In August, transit officials said a Metro-Card swipe could go up from $2.75 to $3.75.”
  • “The MTA received $4 billion from the federal government earlier this year but has asked for an additional $12 billion. It is uncertain whether additional money for transit assistance will be included in future COVID-19 stimulus bills.”
  • “Motorists and mass transit riders in New York are already facing fare and toll increases next year. Tolls and fares are planned to increase 4 percent in both years, New York State Comptroller Thomas DiNapoli said earlier this month.”
    • “The board is considering a number of options to raise fares on buses, subways, the LIRR and Metro-North by 4%. Tolls could go up as much as 8% or $6.70.”
    • “The projected fare and toll increases would raise $145 million in 2021 and rise to $650 million by 2024, according to the report.”
  • “Even if normal ridership returns by 2023, the MTA still projects budget deficits totaling more than $19 billion through 2024, according to DiNapoli’s report. Included in that is a projected $6.3 billion deficit in 2021, which would be more than 50 percent of total revenues. The report called the gaps ‘historic in nature.'”
  • “‘Increased cleaning and disinfecting of the subway, rail and bus systems — which has included the rare step of closing subways overnight — is costing the MTA about $1 billion in unplanned expenses,’ DiNapoli said. He didn’t have an estimate for how much the MTA is saving by the overnight closures, but said any savings are likely being offset by the costs of cleaning.”