Jobs rise in New York – with the pandemic gap between rich and poor

New York City’s economy came back to life in October as rising vaccination rates and falling infections spurred a wave of hiring.

Yet new data highlights deep-rooted inequalities in the city – even as the Biden administration struggles to pass a social spending bill that would help New York’s less wealthy residents and mayor-elect Eric Adams is committed to fighting disparities.

The city created 83,500 jobs in October, the biggest increase since the first months of the pandemic recession resumed in 2020. The increase reached 2%, double the rate for the country as a whole.

It was the first time in months that job creation in the city exceeded that of the rest of the country.

The local unemployment rate edged down to 9.4% from 9.8% recorded in September. Although still much higher than the national rate, the number of unemployed city residents has declined for nine consecutive months.

“Infection rates in New York City fell from mid-September to the end of October,” said James Parrott, an economist at the New School. “As the rate of viral infection increases, the rebound in employment goes in the opposite direction.”

Virtually all major sectors posted employment gains, led by private colleges and universities, business services, health care and the arts.

Broadway performers stage pop-up show in Times Square
Ben Fractenberg / THE CITY

One particularly important sign of things to come: the addition of nearly 7,000 child care jobs in the past two months. With schools returning to in-person learning, many economists believe the lack of affordable and abundant child care is preventing many parents, especially women, from re-entering the workforce.

The promising job figures precede the economically crucial holiday season – the first since widespread availability of vaccines – and the dawn of a critical year that will bring a new city administration and a fierce race for governor.

The one percent prosperous

New reports, however, show how New York remains one of the most unequal cities in the country.

New York’s richest 1% of taxpayers accounted for about 35% of all taxable income in the city in 2019, according to data updated annually by the Independent Budget Office.

Some 55% of taxpayers earned less than $ 40,000, which is less than 10% of all taxable income in the city.

All signs point to the gap between the rich and the poor widening rapidly during the pandemic – to the point that it could rival 2007, when the 1% made up over 45% of all income. It was also a year in which the stock market exploded and Wall Street handed out big bonuses.

A construction worker hauls scaffolding for a project on Wall Street, October 20, 2021.

A construction worker hauls scaffolding for a project on Wall Street, October 20, 2021.
Ben Fractenberg / THE CITY

Since March 2020, the benchmark S&P 500 has climbed 75% and the highly technical Nasdaq index has doubled. The richest 1% receive less than 40% of their income in wages, with the majority coming from earnings in stocks and bonds, as well as dividends from stocks and private companies.

Wall Street profits are expected to set a record this year, and bonuses are expected to jump 25% to 30% next year at brokerage firms, according to compensation consultant Johnson Associates.

Last year, the average bonus hit $ 175,000, according to a report by State Comptroller Thomas DiNapoli. The average salary was over $ 420,000.

CUNY highlights inequalities

At the same time, an in-depth study of CUNY students by the Federal Reserve Bank of New York shows how difficult it is to achieve economic gains for black and Hispanic New Yorkers, even in an institution widely touted as a path towards the middle class.

Black students are more likely than white students to take on debt and be behind on student loans, while delaying graduation, according to the study.

Consumer debt data shows that black and Hispanic CUNY graduates are less likely to buy a home or car and have lower credit card debt. They also have higher delinquency rates than white CUNY alumni.

In addition to the racial disparities, the women of CUNY do better in school than the men, but this does not translate into more purchasing power.

“You can see a lot of gender and racial inequalities in the data,” said Rajashri Chakrabarti, senior economist at the New York Fed. “There are inequalities in household debt as well as in delinquency. Inequality in educational attainment is an important factor in racial inequality. For gender inequalities, structural factors also play a role.

“The great equalizer”

While city and state governments have limited ability to influence worsening inequality trends in New York City, the Biden administration’s $ 1.7 trillion social spending bill would significantly help local residents. poorest in town, said Rep. Ritchie Torres (D-The Bronx).

Council member Ritchie Torres (D-The Bronx) attends a City Hall hearing on January 24, 2019.

Representative Ritchie Torres (D-The Bronx)
Ben Fractenberg / THE CITY

Two provisions in particular would have a major impact in the city, he argues:

Expanding home care for the elderly and increasing wages for home care workers would improve finances for both older people – and women of color who largely provide care while earning wages. of misery.

Making the doubling of the refundable child tax credit permanent would essentially provide social security to families with children, lifting these families out of poverty.

“It’s the great equalizer,” Torres said.

Although watered down, a global minimum tax for businesses and the funding of aggressive tax law enforcement by the IRS would also mean that businesses and the wealthy would pay their fair share, he added.

Adams, meanwhile, pledged to tackle inequalities by effectively tackling COVID and investing in infrastructure, skills training, helping struggling businesses and incentives for new industries to emerge. settle in the city.

“The new jobs data is a good sign that our city is ready to bounce back, but we have work to do to make sure our return is fair, sustainable and prioritizes those who have been most affected by the pandemic. COVID-19 and historic inequalities. “, He declared in a statement to THE CITY.

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