Jeff Platsky

Upstate New York’s economy continued a long run of stagnancy in 2019, with dim prospects for improvement in the near future.

That was the message from regional economists from the Federal Reserve Bank of New York who issued their annual assessment of the region Tuesday, noting a sharp divergence in job growth in the 48 counties it defines as upstate versus 14 other counties downstate.

While jobs grew at a 1.4% clip nationally from October 2018 to October 2019, and 1.3% downstate, upstate showed no expansion.

“Only in downstate New York has there been any significant job creation during the past year,” Federal Reserve economists said in their summary findings.

The wide difference between upstate and downstate performance continues a trend that has been apparent since at least 2010, according to numbers from the New York Fed.

Upstate-downstate divide Downstate job expansion grew 2.1% annually from 2010 to 2018, outpacing a national expansion that grew at 1.8% over the same period.

Meanwhile, upstate added jobs at an 0.7% annualized pace.

Even in the downstate area, economists warn there’s been a significant deceleration in job creation over the past year, sending some warning signs for the region that stretches from Ulster and Dutchess counties south to the tip of Suffolk.

“A variety of headwinds, including labor shortages and uncertainty related to trade, have contributed to this economic slowdown,” the economists said.

Weighing heavily on economic expansion, especially in the manufacturing sector, is uncertainty over trade policies.

Work shortage apparent Additionally, a severe worker shortage is hampering hiring efforts in several sectors, economists noted.

“Unemployment has been at historically low levels, even in markets where economic growth is sluggish, making it difficult for employers to find workers with the right skills,” the regional economists said.

“In fact, in recent months, a majority of both manufacturers and service firms in our region reported difficulty hiring workers due to a lack of qualified candidates.”

All upstate regions as defined by the New York Fed have seen declines in labor force since the 2008 recession, from as much as a 15% drop in Glens Falls and 14% in Elmira and Binghamton, to as little as 1% in Kingston, according to data from the state Department of Labor.

By contrast, the New York City labor force was up 4%.

Limiting upstate’s ability to attract business and grow employment are population losses that have been endemic across a wide swath of the landscape, the New York Fed said.

New York has lost 1 million people to other states over the past decade, according to the Empire Center for Public Policy.

“A big part of why upstate is stagnating is a decline in labor force,” regional economist Jaison Abel said during the briefing.

People leaving the state or aging out of the work force presents a critical challenge for upstate and represents “a headwind for the entire economy,” he said.

Housing prices rise There were some positive signs in the economy, however.

Economists noted rising home prices over the year – 6.8% in Binghamton, 5.5% in Buffalo, 4.5% in Syracuse and 4.3% in Rochester, versus 3.5% nationwide.

Those increases represent a turnaround for all regions, and in particular for Binghamton, where housing prices declined for the five-year period from September 2013 to September 2018.

Abel said reduced inventory of existing homes and a lack of new home construction upstate could explain the uptick.

© 2019 Star-Gazette

You may also like

State’s Growing Budget Hole Threatens NYC Jobs and Aid as Congress Takes a Holiday

“The biggest problem for the state is the enormous, recurring structural budget gap starting next year and into the future,” said E.J. McMahon of the conservative-leaning Empire Center. “Cuomo clearly hopes that starting in 2021, (Democratic presidential candidate Joseph) Biden and a Democratic Congress will provide states and local government a couple of year’s worth of added stimulus. Read More

How Andrew Cuomo became ‘maybe the most powerful governor’ in U.S.

Ed McKinley ALBANY — When the New York Constitution was reorganized nearly 100 years ago to give the governor more power over the budget process,  noted there was a risk of making “the governor a czar." M Read More

Study disputes Cuomo on Trump tax package; experts say it’s complicated

Michael Gormley ALBANY — A new study by a conservative think tank says President Donald Trump’s 2017 tax law gave most New Yorkers a tax cut, even as Gov. Andrew M. Cuomo insists on repealing the measure because he says it will cost New Yo Read More

Empire Center sues Department of Health over nursing home records

Johan Sheridan ALBANY, N.Y. () — The Empire Center filed a  against the state Department of Health on Friday. “This case isn’t about assigning blame or embarrassing political leaders,” said Bill Hammond, the Empire Center’s Read More

Good news: That New York pork isn’t going out the door after all

The Empire Center first reported Tuesday that grants — 226 of them, totaling $46 million, to recipients selected by the governor and individual state lawmakers — seemed to still be going ahead. Read More

New York Lawmakers Seek Independent Probe of Nursing-Home Coronavirus Deaths

With lingering questions about how the novel coronavirus killed thousands of New Yorkers who lived in nursing homes, a group of state lawmakers is pushing to create an independent commission to get answers from the state Department of Health. Read More

Policy analyst: Cuomo wrong to write-off nursing home criticism as political conspiracy

“The importance of discussing this and getting the true facts out is to understand what did and didn’t happen so we can learn from it in case this happens again,” Hammond said. Read More

EDITORIAL: Nursing home report requires a second opinion

No doubt, the Health Department and the governor would like this report to be the final word on the subject. But if it’s all the same with them, we’d still like a truly independent review. Read More

Subscribe

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

CONTACT INFORMATION

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

Phone: 518-434-3100
Fax: 518-434-3130
E-Mail: info@empirecenter.org

About

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.