Today’s Economic Press Briefing at the New York Fed presented our economic outlook for New York, Northern New Jersey, and Puerto Rico. We showed that many parts of the region have bounced back quite well from the Great Recession and are growing at a solid clip, including New York City, Buffalo, and Albany. The picture is a bit different in other parts of the region, though. In both Northern New Jersey and the Lower Hudson Valley, employment has been growing steadily, but jobs are still not back to their pre-recession peak. And there are also pockets of significant weakness, such as Binghamton, Puerto Rico, and the U.S. Virgin Islands, which have yet to show any meaningful signs of recovery.
While the Great Recession was the deepest and longest recession in recent history for the nation as a whole, New York City bucked that trend to a surprising degree. The city has performed quite well when compared with other downstate areas, and has grown remarkably well compared with its recoveries in previous cycles. What might be surprising is that, contrary to New York City’s recent history, it did so with little help from its traditional growth engine: Wall Street. With Wall Street job creation stalled, New York City’s rising tech industry has helped fill the gap, adding around 50,000 jobs over the past five years.
Though not as strong as New York City, Long Island has seen reasonably good job gains. Some metro areas across upstate New York are also performing quite well, especially Buffalo and Albany. In these places, construction and manufacturing are boosting employment for the first time in decades, in part due to a number of public and private investments in Buffalo, such as the new Solar City factory, and the ongoing impacts of nanotechnology activities in Albany.
However, not every part of the region is doing so well. Northern New Jersey’s economy is growing modestly, since job creation is being hampered by weak business services and finance sectors. The Lower Hudson Valley and Fairfield County in Connecticut have performed slightly better than northern New Jersey but still lag the region and the nation in job creation. In upstate New York, Syracuse, Binghamton, and Utica-Rome continue to struggle with little or no job growth, and contrary to its neighbors in Buffalo and Albany, are feeling the sting of ongoing manufacturing job cuts. And after a deep economic slump, Puerto Rico’s economy, as well as that of the U.S. Virgin Islands, remains depressed.
For more details, visit the Economic Press Briefings website.
The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.
Jaison R. Abel is a research officer in the Federal Reserve Bank of New York’s Research and Statistics Group.
Richard Deitz is an assistant vice president in the Group.