Three full years after the initial COVID-19 outbreak, New York’s post-pandemic jobs recovery remains among the weakest in the country.
Measured on a seasonally adjusted basis, private employment in New York State as of February was still 104,000 jobs short of its February 2020 pre-pandemic peak (-1.2 percent), while the total U.S. private jobs count was up nearly 4.8 million jobs (+2.4 percent), according to data from the state Labor Department and the U.S. Bureau of Labor Statistics (BLS). If the Empire State had matched the nationwide trend during this period, it would have 320,000 more private-sector jobs.
As mapped below, private job counts as of February exceeded pre-pandemic levels in 36 states, including neighboring New Jersey (+3.3 percent), Pennsylvania (+0.7 percent), and Massachusetts (+0.1 percent). Only six states, all smaller than New York, have experienced weaker employment recoveries since early 2020 — and in several of those cases, slow job growth was due largely to factors other than the pandemic (such as severe hurricanes in Louisiana and falling shale oil production in North Dakota.) By contrast, private sector employment has grown much faster in New York’s large peer states: Florida (+8.2 percent), Texas (+ 7.8 percent), and even California (+2.5 percent).
Not counting interstate regions, the BLS keeps track of monthly non-seasonally adjusted employment for 375 metropolitan statistical areas (MSAs) and metropolitan divisions throughout the country. According to the latest BLS data, February private job counts had moved above the 2020 level in 266 of these metro areas, with a median gain of 2.1 percent over the three-year period.
But job counts still lagged the pre-pandemic level in 14 of 15 New York metro areas, as shown below.
When it comes to post-pandemic job recovery, most New York metro areas are trailing far below the national average, ranking among the worst-performing areas in the entire country. Nearest the bottom are several upstate MSAs that were already struggling for years before the pandemic: Elmira, Utica-Rome, and Binghamton. Upstate’s non-metropolitan rural counties were even further behind — still down 23,200 jobs, or 6.3 percent, from pre-pandemic employment levels.
Among upstate’s larger MSAs, Buffalo-Cheektowage-Niagara Falls and Rochester are furthest from full recovery, while Albany-Schenectady-Troy (home of state government) was close to regaining jobs lost since 2020. New York’s lone outlier on the positive side was the small and atypical Watertown-Ft. Drum MSA, where economic activity primarily reflects the deployment trends of the U.S. Army’s 10th Mountain Division.
A murky future
If the state as a whole continues to add jobs at its most recent seasonally adjusted monthly pace, New York will finally exceed its February 2020 employment level in July. Full recovery is further away in much of upstate — and perhaps in the Dutchess-Putnam area as well, although the mid-Hudson has enjoyed stronger growth in the recent past.
Even assuming a full jobs recovery by mid-summer, New York will have significant ground to cover to catch up to other states — and one in particular.
Before the pandemic, New York had 404,000 more private jobs than Florida, BLS stats show, but by February 2023, Florida’s job count had moved 341,000 ahead of New York’s. That net swing of nearly three-quarters of a million jobs translates into significantly more economic opportunity in Florida, and less in the Empire State.
As they begin negotiations on a budget for the state fiscal year starting April 1, Governor Hochul and the Legislature seem oblivious to the economic challenge posed by New York’s lagging economic performance.
If anything, the governor’s plan to continue spending at an unsustainable rate spells trouble for the state’s economic prospects. The Legislature’s alternatives are, if anything, an even bigger threat to future economic growth. Both the Senate and Assembly favor adding billions more in additional spending — financed by significant new increases in taxes on the state’s highest-earning businesses and individuals. And legislators in both houses also are advocating other policies likely to further undermine job creation. These include, most notably, a “climate leadership” agenda with massive unacknowledged implications for energy costs and aval, and a proposal to raise New York’s hourly minimum wage from $15 to $21.25 in the next three years.
New York’s extraordinary job losses during the pandemic could be blamed on a public health crisis traceable to China — compounded, arguably, by the Cuomo administration’s overly prolonged and stringent restrictions on normal business and social activities.
Looking ahead, however, the blame for any continuing economic weakness in New York can be placed squarely on fiscal and regulatory policies incubated closer to home — in Albany.