Research Special Topics

Signs of Progress: NYC’s Economic Recovery

March 2021

Overview

Monthly tax revenues continue to exceed projections, subway ridership has reached the highest levels since the onset of the pandemic, and new data confirms that the city’s economy proved more resilient than expected in 2020. However, citywide employment growth is sluggish, despite gains in the tourism sectors.

A Partnership survey of major employers in March found that only 10% of Manhattan office employees have returned to the workplace but almost 50% are expected back by September as vaccination availability continues to increase.

Key Statistics

Unemployment Rates, December

  • NYC: 12.9%, up from 12.6% in January
  • NYS: 8.9%, up from 8.8% in January
  • US: 6.2%, down from 6.3% in January

Employment

  • Industries that suffered the greatest losses during the pandemic show the largest employment growth from January to February:
    • Accommodation and Food Services: 6% increase
    • Arts, Entertainment and Recreation: 5% increase
    • Retail: 2% increase
  • New York City private sector employment is down 16%, or 642,000 jobs, from one year ago, when the city had a near record high 4.1 million jobs and a near record low 3.7% unemployment rate.

Economic Output

  • New York City’s gross city product (GCP) was projected to suffer a 6%-13% overall decline in 2020, according to preliminary estimates released last spring and summer by the City Comptroller’s office and the Mayor’s Office of Management and Budget.
  • New estimates show New York City’s GCP proved more resilient than expected:
    • NYC: decreased 3.3% in 2020 compared to 2019
    • NYS: decreased 3.5%
    • US: decreased 2.7%
  • The resiliency in city GCP is attributed to strong performance in key sectors:
    • Information: 4% GCP growth from $97.6 billion in 2019 to $101.8 billion in 2020
    • Education: 2% growth from $20.9 billion to $21.2 billion
    • Finance and insurance: 1% growth from $179.8 billion to $182.2 billion

Note: Data from Emsi; U.S. Bureau of Economic Analysis estimates U.S. GDP declined 3.5% in 2020.

City Finances

  • January tax receipts were $230 million above city projections made in January. Higher than expected tax revenues included:
    • Personal income taxes up 11%, or $204 million
    • Property taxes up 2%, or $88 million
    • Sales taxes up 5%, or $25 million
  • Tax collections for city fiscal year starting July 1, 2020, were $45.5 billion through January 2021, $719 million higher than the city’s November estimate.
  • City sales tax collections totaled $583 million in February, down only 4% from February 2020.

Unemployment Claims

  • 18,319 initial unemployment claims were filed during the week ending March 20.
    • Weekly claims have hovered around 18,000 throughout March, down from 30,000 at the end of January and over 180,000 in April 2020.
  • 84% of unemployment claims have been filed by residents of boroughs outside of Manhattan.
  • 208,200 unemployment insurance beneficiaries in February, the lowest since March 2020.

Business Licenses

  • 224 business licenses were issued in February, down slightly from 241 in January.
    • The pace of monthly issuances has slowed since reaching 274 in December.

MTA Ridership
Subway

  • Subway ridership surpassed 1.9 million on March 12 and March 19, the highest level since March 16, 2020.
    • Average weekday ridership has increased through the first three months of 2021.
  • Average weekday ridership remains 67% below prior year levels as of February but has recovered substantially from April and May of 2020, when ridership was down more than 90% from the preceding year.

Bus

  • Bus ridership was 1.1 million on Wednesday, March 17, 53% lower than the same day in 2020.
  • Weekday bus ridership averaged 1.07 million in March to date, up 17% from 910,000 in February.

LIRR

  • Ridership on the Long Island Rail Road reached 81,400 on March 17, down 74% from the same day a year ago.
  • LIRR weekday ridership averaged 79,300 in March to date, up 22% from an average of 65,000 in February but down 75% from March 2020.

Metro-North

  • Metro-North ridership was 60,700 on March 19, down 78% from the same day a year ago.
  • Weekday Metro-North ridership averaged 57,200 in March to date, up 22% from 47,000 in February but down 79% from March 2020.

Bridges and Tunnels

  • Vehicles traveling via MTA-operated bridges and tunnels totaled 863,200 on March 19, down 10% from the same day a year ago.
  • After reaching 829,500 in August, the average number of vehicles using MTA-operated bridges and tunnels during weekdays declined for six consecutive months through February, before increasing 19% month-over-month in March 2021 to date.