New York’s post-pandemic employment recovery came to a halt and moved into reverse in December, according to the state’s preliminary jobs estimate for the final month of COVID-wracked 2020.

Private payroll employment in December was 966,000 jobs below the level of the previous year, a decline of 11.5 percent at a time when the national employment was down 6.1 percent. On a year-to-year basis, the state’s job decline was actually larger in December than in November, when employment was down 937,000 jobs, or 11.2 percent. After a decade-long economic expansion following the Great Recession of 2008-09, New York’s December private jobs count was the lowest since 2011.

As shown below, the hoped-for V-shaped employment recovery has become a sagging “L”.

In line with previous trends, the year-to-year drop in private jobs was largest in New York City, and also hit double digits in the Albany, Rochester  and Syracuse areas, while Buffalo had a somewhat less severe decline, as shown by the regional breakdown from the state Labor Department release (below). Among smaller upstate metro areas, the private employment change in the past year was closer to the national average in Elmira and Binghamton (two of the weakest areas in the state for more than a decade) and in Ithaca and Kingston (two of the strongest, pre-pandemic).

The same preliminary state Labor Department indicated:

  • On a seasonally adjusted monthly basis, statewide private employment in December was down 22,000 from November, a 0.3 percent drop that was three times the national average of -0.1 percent; in fact, the New York decline was fully one-fourth of the national total.
  • New York’s job losses remain concentrated in the leisure and hospitality sector—i.e., restaurants, food service, and hotels.
  • The statewide unemployment rate in December was 8.2 percent, barely changed from November’s 8.4 percent, while the U.S. rate remained unchanged at 6.7 percent. The rate was much higher in New York City at 11.4 percent, and below the national average in the rest of the state at 5.9 percent—but while the city’s jobless level represented a half-point improvement over November, the rate in the rest of the state was 0.2 percent higher.

Four more years?

The state’s FY 2022 Executive Budget, released this week, blames the slowdown on a combination of weather and stepped up coronavirus cases. As summarized in the economic forecast (see p. 48 of this volume):

With the onset of colder autumn weather, and virus-safe practices such as outdoor dining no longer feasible in many areas of the State, the labor market recovery has since slowed to a trickle, as the State added only 29,500 total jobs and 36,300 private sector jobs in November. With COVID-19 transmission intensifying across both the State and the nation, job growth is expected to slow even further over the winter months until vaccines become widely available. Job growth of 5.4 percent is now projected for 2021, following a decline of 9.9 percent for 2020. Private sector job growth of 6.2 percent is projected for 2021, following an estimated decline of 11.1 percent for 2020. These projections compare to national declines of 5.7 percent for total employment and 6.2 percent for private employment for 2020, followed by growth of 2.7 percent for total employment and 3.4 percent for private employment for 2021. New York State employment is not expected to reach its pre-pandemic peak until 2025. [emphasis added]

About the Author

E.J. McMahon

Edmund J. McMahon is Empire Center's founder and a senior fellow.

Read more by E.J. McMahon

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