Research Special Topics

Signs of Progress: NYC’s Economic Recovery

November 2023

Overview

Times Square, until recently a symbol of pandemic damage to Manhattan’s central business districts, is experiencing a resurgence of economic activity. Citywide, employment has surpassed 2019 highs, as has airport activity. On the flip side, the number of New Yorkers receiving public assistance has increased dramatically.

New York City’s economy recently hit several historic milestones in COVID-19 recovery.

  • New York City employers added 16,800 private sector jobs in September, lifting private sector employment past its pre-pandemic peak to 4.13 million—the highest on record.
  • The 192nd new business opened in Times Square in October, surpassing the 179 businesses that closed during the pandemic.
  • The region’s airports had their busiest month in history with over 13.3 million passengers served in August.

Despite these high-water marks, several indicators of New Yorkers’ economic wellbeing reveal distress.

  • 145,000 fewer residents of the five boroughs are employed than pre-pandemic, and at 5.3%, the unemployment rate remains higher than the 4.3% in February 2020.
    • 72,000 New Yorkers have been unemployed for at least 27 weeks—a common threshold for long-term unemployment—up 44%, or 22,000 residents, from 2019.
  • Over 482,000 New Yorkers received cash assistance (also known as welfare or public assistance), up 52%—or 165,000 recipients—from February 2020.
  • 1.7 million New Yorkers received Supplemental Nutrition Assistance Program (SNAP) benefits (formerly known as “food stamps”), up 17% from February 2020.
    • SNAP assistance rolls began declining beginning in March, although recent research from the Center for New York City affairs suggests this may be due to delays in application processing as opposed to reduced need.

Businesses continued to rein in job listings as employment surpassed pre-pandemic levels.

  • New York City employers listed an average of 118,700 full-time job postings in the three months ending October 2023, down 46% from a year prior and the fewest since pre-pandemic.

New York City collected $2.5 billion in sales tax during Q3 2023, up 5% or $119 million from Q2 2022; collections in the rest of the state grew more slowly (3%).

Nearly 38,000 new businesses formed in the city since January 2022.

  • This includes over 9,000 new businesses formed in Brooklyn during the 12 months ending March 31, 2023.
  • One in every seven businesses in the city was opened in the past year.

New York City’s generative artificial intelligence (AI) companies continue to attract private investment despite the broader downturn in venture capital funding in 2023.

  • New York City startups in generative AI—defined as the field of artificial intelligence that predicts human-like content across various domains using models trained on diverse inputs such as text, images, video, and speech—have raised $897 million in venture capital (VC) funding in 2023, nearly twice as much as all of 2022 and surpassing the previous record of $868 million raised in 2021.
  • The number and value of VC deals secured by city-based generative AI startups has risen rapidly over the past decade from a mere $5 million across 8 deals in 2014.
  • In contrast, total VC funding raised by New York City companies so far in 2023 is down 41% from 2022.

The city’s tourism industry continues its gradual recovery.

  • 87.3% occupancy rate in New York City hotels for the four weeks ending October 14, down 4.5% during the same period in 2019, according to CoStar.
    • Note: Temporary and permanent hotel room closures may affect comparisons of occupancy rates; about 12,000 hotel rooms housed asylum seekers as of the end of September.
  • 285,100 average daily visitors to Times Square during the last week of October, down 20% from 355,800 in the equivalent week in 2019.
  • Broadway shows attracted 218,600 theatergoers and grossed $26 million in sales during the week ending October 29.
    • Attendance and sales were down 19% and 15%, respectively, from the equivalent week in the 2019 season.

New Yorkers have sustained the large spike in bike ridership triggered by the pandemic with ridership setting new records in recent months.

  • More than 698,000 bikes crossed the East River bridges in October, up 18% from October 2022 and up 50% from October 2019.
    • The bridges recorded a record 754,000 bike crossings in August.
  • Over 4.07 million users rode Citi Bike in August 2023, the most rides in a single month.
  • Average daily bike ridership in the New York City metro area nearly doubled between 2019 and 2022, the fastest growth of any metro, according to a recent StreetLight Data report.

The last week of October punctuated recent gains in ridership across the region’s transit system.

  • Weekend subway ridership surpassed 2.7 million passengers on Saturday, October 28, reaching 82% of pre-pandemic and the highest weekend total since 2020.
  • The subway carried over 24 million passengers during the week ending October 29, the highest weekly total in the last 12 months.
  • 955 million trips on the subway were completed in 2023 through October, up 15% from 830 million in the same period last year.
  • The commuter railroads also both posted their best weeks in a year during the last week of October; the Long Island Rail Road carried 1.4 million riders and Metro-North Railroad carried 1.3 million.