Research Special Topics

Signs of Progress

December 2020

Overview

Progress toward an economic recovery for New York City has slowed in the face of a second surge of COVID-19. New York City has seen upticks in economic activity since June, but economic indicators are far from reaching pre-pandemic levels. Private sector employment and business creation rates are improving, but more slowly than in the summer. One piece of good news is that city business and personal income tax revenues for the first quarter of the fiscal year beginning July 1 are $642 million above projections, contributing to a reduction in the city’s projected budget gap.

Key Statistics

Unemployment Rates, October

  • NYC: 13.2%, down from 13.9% in September
  • NYS: 9.6%, down from 9.7%
  • US: 6.9%, down from 7.9%

Employment

  • New York City’s private sector employment increased by 14,700 jobs in October 2020.
  • Industries with the largest employment growth from September to October included:
    • Accommodation and food services: 6% increase
    • Transportation and warehousing: 6% increase
    • Information: 1% increase

City Finances

  • Tax revenues were $1 billion higher than projected for city fiscal year (FY) 2020, which ended in June.
  • Tax revenues continued to outperform expectations through the first quarter of FY 2021, exceeding projections by $834 million through September. Higher than expected revenues included:
    • Business income taxes up 45%, or $391 million
    • Personal income taxes up 11%, or $251 million
    • Property transaction taxes up 27%, or $108 million
    • Real property taxes up 1%, or $86 million
  • Improved revenues have reduced the FY 2022 budget gap to $3.8 billion, down $428 million, or 10%, from the $4.2 billion gap projected as of June.
    • The City Comptroller’s office notes that increased tax revenues provide a path to closing the city’s budget gap in FY 2022.
  • New York City collected $621 million in sales tax revenue in October, an increase of 34% from the $463 million collected in September and the most collected since March.

Unemployment Claims

  • 20,456 initial unemployment claims were filed during the week ending November 14, down 89% from a peak of 184,525 claims filed during the week ending April 11.
    • Claims have declined for six consecutive weeks and are at the lowest level since March.
  • The number of unemployment insurance beneficiaries in the city has declined for four consecutive months since peaking at 795,300 in June.
    • 385,800 unemployment insurance beneficiaries as of October 2020, down 43% from 676,300 beneficiaries in September.
  • 84% of unemployment claims have been filed by residents of boroughs outside of Manhattan.

Business Licenses

  • 240 business licenses were issued in October, up 15% from 209 licenses issued in September.
  • The number of new business licenses has increased for five consecutive months and is up 314% since May.
  • However, issuances are down 51% from 485 licenses issued during October 2019.

Note: Includes licenses issued by the NYC Department of Consumer and Worker Protection.

MTA Ridership
Subway

  • Subway ridership surpassed 1.8 million on Friday, Nov. 20, 69% lower than the same day in 2019.
  • Weekday subway ridership has averaged 1.76 million in November, slightly higher than ridership levels in October and 295% higher than ridership in April.

Note: April saw the lowest levels of ridership since the pandemic hit the city in March, decreasing 92% from pre-pandemic levels.

Bus

  • Weekday bus ridership has averaged 1.07 million in November, down about 52% from November 2019.
    • Weekday ridership in November is down about 2% from October.
  • Bus ridership eclipsed 1.04 million on Nov. 20, down from 1.16 million on Oct. 14, the highest level since the resumption of fare collection beginning Aug. 31.

LIRR

  • Ridership on the Long Island Rail Road reached 87,400 on Nov. 20, down 73% from the same day a year ago.
  • LIRR weekday ridership averaged 86,600 Nov. 1-20, up 871% from an average of 8,900 in April and up 1% from 85,800 in October.

Metro-North

  • Metro-North ridership was 60,400 on Nov. 20, down 79% from the same day a year ago.
  • Weekday Metro-North ridership averaged 57,400 in November through Nov. 20, up 313% from 13,900 in April but down 12% from 65,100 in October.

Bridges and Tunnels

  • Vehicles traveling via MTA-operated bridges and tunnels totaled 843,100 on Nov. 20, down 14% from the same day a year ago.
  • Since peaking at 829,500 in August, the average number of vehicles using MTA-operated bridges and tunnels during weekdays has declined gradually for three consecutive months to 783,700 in November through Nov. 20.