Entering the second autumn since the COVID-19 outbreak of March 2020, the pace of New York State’s pandemic economic recovery has been abysmal by almost any standard.

New York was the national epicenter of the pandemic, and Governor Cuomo’s “New York State on PAUSE” business shutdowns and other restrictions led, in short order, to the loss of nearly 2 million jobs in the first full month after the infection began spreading in the New York City area. Economically, only the tourism-intensive states of Nevada and Hawaii experienced greater economic calamities in the early going of the public health crisis.

More recently, even when New York’s monthly economic data looked positive on the surface, there has been a more negative story to be found in the longer-term details viewed from a broader perspective.  For example, as noted here last week, while New York gained private-sector jobs at twice the national pace in August, the state remained far below the national trend of recovery to pre-pandemic employment levels.

State-by-state data estimates posted this week by the federal Bureau of Labor Statistics (BLS) further highlight New York’s poor relative performance, as illustrated by the map below. Seasonally adjusted private employment in New York as of August was still 9.8 percent below the state’s February 2020 level, compared to a net decrease of just 3.6 percent for the U.S. as a whole during the same period. This ranked next-to-last among all states; only Hawaii remains worse off, with private payrolls still 14.5 percent below the state’s pre-pandemic total.


Peeling further into the numbers, New York trails the national jobs recovery trend in every private industry for which comparable data exists, as shown below.


Over the last 18 months, New York came within a percentage point of the national employment trend in only one private-sector industry: information, which includes publishing, software, broadcasting and motion picture production. However, these employers account for a relatively small share of all private jobs in the state (just 3.7 percent as of August).

New York’s two other relatively strong private industry sectors by national standards were education and health services—which has a large government-subsidized component—and manufacturing.

By contrast, the small net employment decline New York’s government sector came much closer to matching the national trend, especially among local governments.

As of August, New York State’s unemployment rate was 7.4 percent, statistically unchanged from the previous month, compared to 5.4 percent nationally. Only two states—California (7.5 percent) and Nevada (7.7 percent)—had higher employment rates last month. As also noted here:

The components of the unemployment statistic revealed another troubling trend: the number of New Yorkers in the labor force declined, as did the labor force participation rate. In two words: not good.

Income trends

Personal income data released today by the federal Bureau of Economic Affairs look more positive on the surface: at a seasonally adjusted annual rate, the total personal income of Empire State residents was down 18.6 percent in the second quarter of this year, one of the smallest decreases of any state during a period when income nationally was down nearly 22 percent, reflecting the expiration of temporary federal unemployment and other benefits for individuals most affected by the pandemic recession.

However, the data also show that, through the second quarter, New York’s economy remained much more dependent on “transfer payments,” including federal and state unemployment benefits. New Yorkers’ earnings from work were up just 6.5 percent, lower than all but seven states, during a period when earnings nationally rose nearly 11 percent.


About the Author

E.J. McMahon

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

Read more by E.J. McMahon

You may also like

Pandemic deaths in New York nursing homes show no correlation with staffing levels

Nursing home staffing levels remained an unreliable indicator of Covid-19 risk for residents through the second year of the pandemic. Read More

DiNapoli audit diagnoses the Health Department’s chronic conditions

A penetrating new audit of the Health Department's pandemic response makes clear that problems at the agency run much deeper than its misreporting of nursing home deaths. Read More

In slow post-pandemic jobs recovery, NY still trails 48 states

Much of the country has shaken off or is close to moving beyond the job losses that followed the instant pandemic recession nearly two years ago—but the pace of New York's recovery continues to rank near the bottom among the 50 states, according to upda Read More

New York Should Restore its Unemployment Fund

New York owes $9.3 billion to the U.S. Treasury for pandemic-related debt that, if left unpaid, will inflict harm on resident businesses for years to come Read More

NY’s October job harvest was bountiful (but labor force still shrinking)

New York just tallied its biggest year-to-year October private-sector job gain on record, according to the state's latest monthly state Labor Department report. Read More

The Health Department takes a big step toward COVID transparency

The state Health Department released a flurry of 20 COVID-related data sets this week, taking its biggest step yet toward full transparency about the state's pandemic response. Read More

When COVID-19 struck, a lot of the state’s pandemic stockpile was out of date

Much of the material in the state's pandemic stockpile had passed its expiration date when the coronavirus crisis struck in March 2020, according to newly released Health Department records. Read More

Sluggish in September: NY job growth still trails U.S.

New York's employment recovery slowed to a near halt in the crucial month of September, falling further behind the national growth rate in the 18th full month since the pandemic hit in March 2020, according to and federal monthly job reports. Read More


Sign up to receive updates about Empire Center research, news and events in your email.


Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100

General Inquiries: Info@EmpireCenter.org

Press Inquiries: Press@EmpireCenter.org


The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.

Empire Center Logo Enjoying our work? Sign up for email alerts on our latest news and research.
Together, we can make New York a better place to live and work!