We hate the phrase ‘double-dip,’ especially when it becomes an unfortunate reality.
In September of 2009, as President Obama’s stimulus package was beginning to leak into the economy, New York City’s unemployment rate hit its peak
of 10.1% and stayed there for six months. Since then, the job numbers for the city hovered around 9.7% – dipping this past April to 9.5% for the first time – even as the start-up craze and Brooklyn cultural explosion continued to consume New York’s attention.
But, this past May, it was evident that we were backing ourselves up into the same old corner of 2009, with figures pointing to a 9.7% unemployment rate. And June’s number all but proved that the City might stil be in the economic shitter
According to the Labor Department’s reports this past week, it looks like New York is returning to the gloomy heights of yesteryear. Yes, five months before Election Day, a tenth of the metropolis’s labor force, or 370,000 residents, is once again on the unemployment line at a rate that is 1.8 percent points higher than the national average. However, the numbers from the report paint an interesting dualism between stagnation and production.
As we mentioned before, the start-up craze that Bloomberg hopes to transform New York into the next Silicon Valley is a weird outlier to the jobs report. Spawning highly profitable businesses like Etsy and Tumblr, a whole new private sector has been revitalized in areas like SoHo and Dumbo. But, although the dollar signs pumping out of these companies are huge, they still remain online companies, which tend to employ less employees and more MacBooks.
James Brown, the chief economist in the state’s Labor Department, reaffirmed
this notion: “A lot of the growth in New York City has been in industries that are dominated by commuters, and there’s been a lot of strength in the tech field, which has actually been attracting people to move to the city.” This explains the oddity that, although the unemployment rate is back to 10%, 11,500 jobs were added to the urban economy.
But, these details create an unusual scenario, where it’s a fight against time to see who can move faster: the job defectors or the job creators. As of now, it seems that the former is winning but the Hozziner has faith in the strength of the latter: “As fast as New York City is creating jobs, people are entering the labor market even faster, which indicates optimism and confidence in the long-term future of New York City.”
The ‘long-term future’ is tough to explain for those who need a job now. With heat waves happening left and right and rent skyrocketing at a pace that will soon make Manhattan uninhabitable, it will be intriguing to see what the July numbers bring us. Let us hope for the best.