Research Special Topics

Signs of Progress: NYC’s Economic Recovery

September 2021

Overview

The city’s economic recovery has stalled due to the Delta variant’s impact on employment and tourism. Bright spots include job gains in the arts sector, new business formation and a return to pre-pandemic domestic migration patterns. Subway ridership rose to a pandemic high in August, a trend likely to continue with 41% of Manhattan office employees expected to return to the workplace by the end of September.

Key Statistics

Unemployment Rates

  • 10.5% unemployment rate in July, down from 10.6% in June and a peak of 20% in May 2020.
    • The decrease in the unemployment rate was due primarily to city residents leaving the workforce.
  • The long-term unemployment rate—the share of the labor force unemployed for 27 weeks or longer—averaged 4.3% for the three months ended July 2021, accounting for about 168,000 unemployed individuals.
    • The long-term unemployment rate is down from a peak of 6.3% in Q1 2021 but remains well above the 0.8% rate in Q1 2020.
  • The underemployment rate—which includes those working part-time who would prefer to be working full-time and those who want to work but have given up looking for a job—averaged 15.3% for the three months ended July 2021, down from a peak of 27.3% in July 2020.


Note: Unemployment rate reflects monthly seasonally adjusted rate, long-term and underemployment rates reflect three-month moving averages.

Employment

  • New York City added 16,800 private sector jobs in July. Total employment contracted by 6,100 jobs, due to a loss of 22,900 public administration jobs.
  • Industries with the largest employment growth from June to July include:
    • Arts, entertainment and recreation: 10% increase
    • Education: 6% increase
    • Accommodation and food services: 4% increase
  • As of July 2021, the city has recovered 47% of the 922,200 private sector jobs lost during the early months of the pandemic; private sector employment is 12%, or 487,600 jobs, below February 2020 levels.

Unemployment

  • 418,716 unemployed city residents in July 2021.
  • 151,500 regular unemployment insurance beneficiaries in July, down 15% from June and the fewest since March 2020.
    • In 2019, there was an average of 62,700 monthly beneficiaries.

Return to Office

  • 23% of Manhattan office employees have returned to the workplace as of late August, up from 12% in late May, according to a Partnership survey of major employers.
  • Employers expect that 41% of employees will return by the end of September 2021—down from May estimates of 62%—and 76% of office workers are expected to return by the end of January 2022.
  • 44% of employers have delayed their return-to-office plans because of the recent rise in COVID-19 cases due to the Delta variant.

Job Postings

  • 368,000 job postings with New York City employers in August 2021, down 4% from 384,100 in July.
    • The number of job postings advertising positions that can be filled by remote workers rose to a new high of 33,200 in August, up nearly fourfold from pre-pandemic.
  • Professional services, administrative services, health care and financial services had the greatest number of job postings in August.

Migration

  • The number of people moving out of New York City every month has nearly returned to pre-pandemic levels: in July 2021, net outmigration was only 500 households above pre-pandemic levels.

Notes: (1) Data covers USPS change of address (COA) requests categorized as made by an individual or family; data includes both permanent and temporary COA requests; analysis assumes intra-city moves categorized as net zero outmigration; data likely excludes or under-represents foreign migration, a significant component of New York City’s population change. (2) January and February 2020 were essentially flat compared to previous years, with slightly higher losses of 100 and 300 households respectively.

Sales Taxes

  • Sales tax collections totaled $649 million in July 2021, an increase of 14% compared to $568 million in July 2020 and up 6% from $613 million in 2019.

Tourism

  • 61% occupancy rate in New York City hotels during the week ending August 28; occupancy has declined since peaking at 68% during the week ending July 24.
  • 212,000 pedestrians visited Times Square during the average day in July 2021, up 25% from 169,500 in June and the highest number of visitors since February 2020.

Business Licenses

  • 454 business licenses were issued in July, up 144% from July 2020 and down 5% from July 2019.

MTA Ridership
Subway

  • Average weekday subway ridership increased to a new pandemic high of 2.43 million in August, up from 2.40 million in July 2021.
    • Weekday ridership is down 53% from pre-pandemic levels as of the week ending August 27.

Bus

  • Average weekday bus ridership increased from 1.19 million in July to 1.21 million in August, slightly below ridership in June.
    • Weekday ridership is down 42% from pre-pandemic levels as of the week ending August 27.

LIRR

  • Long Island Rail Road (LIRR) weekday ridership averaged 122,300 in August, the highest since the onset of the pandemic but down 58% from pre-pandemic levels.

Metro-North

  • Metro-North ridership averaged 96,400 in August, down 2% from 98,300 in July and 63% below pre-pandemic levels.

Bridges and Tunnels

  • Vehicles traveling via MTA-operated bridges and tunnels on weekdays averaged 930,600 in August, down slightly from a pandemic high 931,000 in June but only 2% below pre-pandemic levels.

Transit Fare Collection

  • Subway fare revenue totaled $703 million in 2021 through June, down 59% from pre-pandemic levels but exceeding forecasts by $324 million, or 86%.
  • Bus (including local and express service) fare revenue was $319 million in 2021 through June, down 44% from pre-pandemic levels but exceeding forecasts by $197 million, or 161%.