Economic Research & Analysis

March 2017 Economic Snapshot: Women and the Wage Gap

Highlights

The private sector saw moderate job declines in February 2017.
Economic activity in the city is growing at a steady rate after decelerating in 2016.
Residential building is ramping up in Queens and a major infrastructure project caused construction figures to rise.
Overall, rental rates for offices continued to moderately increase through February 2017.
Transit ridership rebounded in January 2017, while tourism showed mixed trends.

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Audio Resources

PODCAST

#83: Private Sector Dips and the Gender Wage Gap in New York City

Simon and Kim are shaking things up this month with a new format and a two-part podcast. First, we take a look at the state of private sector employment in March 2017, and then we explore the gender wage gap in New York City and around the country.

Video

Employment

Private sector employment dropped in February 2017 after an unexpected surge last month due to annual benchmarking. There were 3,300 jobs lost in Educational Services—a sector with regular month-to-month volatility— making up much of this private sector decline. Retail (-2,300) and Arts and Entertainment (-2,100) were responsible for the second and third highest job losses. Health Care and Social Assistance and Manufacturing led job growth in February, gaining 3,800 and 2,500 jobs, respectively.

The unemployment rate fell to 4.3% in February, down from 4.5% in January (the national unemployment rate is 4.7%). The labor force participation rate ticked up 0.3 percentage points to 60.2%. Wages were at the lowest level in over a decade in February (after adjusting for inflation), hitting an average of $1,145 per week. Monthly employment data are seasonally adjusted by OMB.

Monthly employment data are seasonally adjusted by OMB.

Note: New York City Office of Management and Budget (OMB): Per usual, the January 2017 report incorporates the annual benchmark revision, which adjusts the past two years of monthly survey data to align with the more accurate—but less timely—Quarterly Census of Employment and Wages (QCEW). The annual average employment for 2016 was revised up by 30,000 private sector jobs. Estimated employment gains between December and January are often subject to substantial revisions and should be interpreted with caution. Monthly employment data are seasonally adjusted by OMB.
Sources: New York State Department of Labor; US Bureau of Labor Statistics

March 2017 Snapshot - Employment by IndustrySource: New York State Department of Labor

March 2017 Snapshot - Employment by Metro Region

Source: U.S. Bureau of Labor Statistics

Finance

NYCEDC monitors New York City’s gross city product, venture capital financing, and the New York Federal Reserve Bank’s Index of Coincident Economic Indicators, each of which are reported on a quarterly basis. This month, we are reporting data from the New York Federal Reserve Bank.

New York City’s economy began the year with steady growth, according to an index published by the New York Fed. The Index of Coincident Economic Indicators (CEI) shows steady growth since 2016 (before which the City saw two years of decelerating growth). By comparison, indexes for both New York State and the US show economic expansion slowing through 2016.

Note: The CEI is used by the New York Federal Reserve to capture economic activity in a single number, and is constructed from four data series: payroll employment, unemployment rate, average weekly hours worked in manufacturing, and real (inflation-adjusted) earnings.
Source: Federal Reserve Bank of New York; Federal Reserve Bank of St. Louis

Construction

The number and value of new construction projects both rose in January 2017. The total value of citywide construction starts was more than double that of January 2016, due to the start of a $3.4 billion construction project for a new terminal at LaGuardia Airport. Nonetheless, the number of projects started in January 2017 was 25.7% higher than the previous year, the majority of which are nonresidential projects in Manhattan. Residential building projects started at a similar rate to recent trends. Geographic patterns are shifting, however, with surging construction in Queens and Brooklyn making up for falling activity in Manhattan.

Source: Dodge Data & Analytics

March 2017 Snapshot - Construction Starts

Real Estate

The Class A office market has remained relatively steady. Direct vacancy rates decreased slightly from 8.5% in January 2017 to 8.3%, while total vacancy year-to-year trends remain unchanged. Direct rental rates rose 0.7% to $82.25 per square foot over the previous month. Overall, February 2017 rental rates were 2.3% higher than in February 2016.

The change in office total rental rates in Midtown South was particularly pronounced—up 12.4% from last year, while rates Downtown decreased 3.9%. In the final quarter of 2016, direct rental rates remained much lower in Brooklyn at $58.00 per square foot, and $40.37 in Long Island City, Queens.

March 2017 Snapshot

Note: Based on latest available data.
Sources: Zillow; Cushman & Wakefield

Transit & Tourism

Transit ridership is up from January 2017 with growth led by commuter rails and automotive transit. Subway ridership also rose from the prior year after several months of year-end declines. Local tourism indicators improved, and traffic through regional airports continued to rise. Broadway attendance and revenue fell sharply from last year, largely due to fifteen fewer shows in January 2017 than in January 2016.

Sources: Port Authority or New York and New Jersey; Metropolitan Transportation Authority; Broadway League; CBRE

Transit Change Compared to 2016

March 2017 Snapshot - Transit

Tourism Change Compared to 2016

March 2017 Snapshot - Tourism