Overview of the Regional Economy Jason Bram, Research Officer Presentation to the Community Depository Institutions Advisory Council (CDIAC) March 5, 2019 The views expressed here are those of the presenter and do not necessarily represent those of the Federal Reserve Bank of New York or the Federal Reserve System.
Recent Private-Sector Job Trends Year-Over-Year Percent Change as of December 2018 WA MT ND ME CA OR NV ID UT WY CO SD NE KS MN IA MO WI IL MI OH IN KY WV PA VA NY VT NH MA RI CT NJ DE MD AZ NM OK AR TN SC NC MS AL GA AK TX LA FL HI PR Down Flat Up to 1.25% Up 1.25% to 2% Up More Than 2% Source: Bureau of Labor Statistics and Moody's Economy.com. 1
Private-Sector Job Trends Percent Change From Previous Peak to December 2018 WA MT ND ME CA OR NV ID UT WY CO SD NE KS MN IA MO WI IL MI OH IN KY WV PA VA NY VT NH MA RI CT NJ DE MD AZ NM OK AR TN SC NC MS AL GA AK TX LA FL HI PR Down Flat Up to 3% Up 3% to 7% Up More Than 7% Source: Bureau of Labor Statistics and Moody's Economy.com. 2
Current Economic Conditions FRBNY Business Surveys, Current Conditions 60 Diffusion Index 40 20 Empire State Manufacturing Survey Feb 0-20 Business Leaders Survey -40-60 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Federal Reserve Bank of New York. 3
Future Economic Conditions FRBNY Business Surveys, Conditions Six Months Ahead 60 Diffusion Index Empire State Manufacturing Survey 40 Feb 20 0 Business Leaders Survey -20-40 -60 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Federal Reserve Bank of New York. 4
Unemployment Rates Seasonally Adjusted 12 Percent 10 New York City New Jersey 8 6 United States 4 New York State 2 0 1990 1994 1998 2002 2006 2010 2014 2018 2022 Source: Bureau of Labor Statistics and Moody's Economy.com. 5
Labor Force Participation Seasonally Adjusted 70 Percent 65 United States New York State New Jersey Jan Dec 60 New York City 55 1990 1994 1998 2002 2006 2010 2014 2018 2022 Source: Bureau of Labor Statistics and Moody's Economy.com. 6
Total Employment Seasonally Adjusted Index 130 Index (Dec2007=100) New York City Dec 120 New York 110 Jan United States 100 New Jersey 90 Puerto Rico 80 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 7
Total Employment Seasonally Adjusted Index 125 Index (Dec2007=100) 120 115 110 Jan 105 United States Dec 100 Upstate Albany 95 Utica Glens Falls 90 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 8
Total Employment Seasonally Adjusted Index 125 Index (Dec2007=100) 120 115 Dec 110 Jan 105 100 Downstate United States Oran-Rock-West 95 Kingston Dutchess-Putnam 90 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 9
Total Employment Seasonally Adjusted Index 120 Index (Dec2007=100) 115 110 Ithaca Jan 105 100 United States Dec Upstate 95 Binghamton 90 Elmira 85 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 10
Total Employment Seasonally Adjusted Index 120 Index (Dec2007=100) 115 110 United States Jan 105 100 Rochester Buffalo Dec Upstate Syracuse 95 90 85 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 11
Total Employment Seasonally Adjusted Index 125 Index (Dec2007=100) 120 115 110 Jan 105 100 95 Mid-Mon-Ocean United States Berg-Huds-Pass Dec NNJ Newark metro 90 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 12
Total Employment Seasonally Adjusted Index 125 Index (Dec2007=100) 120 New York City Dec 115 110 United States Jan 105 100 95 Long Island Orange-Rockland -Westchester Fairfield 90 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: Bureau of Labor Statistics and Moody's Economy.com; data are early benchmarked by FRBNY staff. 13
Employment Trends In and Around NYC Private-Sector Job Growth First Half of 2018 vs First Half of 2017 Up more than 2.5% Up 1.6% to 2.5% Up 0.6% to 1.5% Up 0.5% or less Down Orange Ulster Dutchess Putnam Westchester Fairfield Sussex Passaic Rockland Bergen Warren Morris Essex Bronx Suffolk Queens Nassau Union Kings Hunterdon Somerset Middlesex Source: Bureau of Labor Statistics and Moody s Economy.com. Monmouth 14
NYC Securities Employment Seasonally Adjusted Levels 290 Thousands Shading indicates time between securities peak and trough Thousands 4,500 230 4,000 Total Employment Minus Securities (right axis) Securities Employment (left axis) Dec 170 3,500 110 3,000 50 2,500 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 Source: Bureau of Labor Statistics,Moody's Economy.com, and FRBNY calculations. 15
Thousands 200 NYC Tech and Securities Employment Thousands of Jobs 150 Securities Employment +18,000 Jan10 to Jun18 +74,000 100 50 Technology Employment Technology Employment Computer manufacturing Electronic shopping Software publishing Data processing, hosting Internet/web search portals Internet publishing Computer systems design Scientific R&D services 0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Source: U.S. Bureau of Labor Statistics (QCEW) and Moody s Economy.com.; FRBNY Calculations 16
New York State Wages by County Average Weekly Wages, Leisure & Hospitality, 1 st Half of 2018 $361 (80%) $288 (100%) $325 or Less $325 to $425 $425 to $525 $525 or More NY State Average=$622 Median Weekly Wage (Min wage % of Median*) * Assuming 26-hour week) Sources: Bureau of Labor Statistics, Moody s Economy.com, New York State Department of Labor, FRBNY calculations. $409 (95%) $407 (71%) $709 (55%) 17
Sources: Bureau of Labor Statistics, Moody s Economy.com, New York State Department of Labor, FRBNY calculations. 18
Home Prices CoreLogic Home Price Index, Seasonally Adjusted 180 Index (Mar2006=100) Kings 160 140 120 100 Manhattan Queens Nassau Dec Suffolk 80 United States 60 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: CoreLogic Home Price Index (including distressed sales). 19
Home Prices CoreLogic Home Price Index, Seasonally Adjusted 160 Index (Mar2006=100) Buffalo 140 Upstate NY 120 100 Rochester Albany Dec United States 80 60 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: CoreLogic Home Price Index (including distressed sales). 20
Update on Puerto Rico & US Virgin Islands By last September (a year after the hurricanes), Puerto Rico s economy and employment had essentially fully rebounded. Follows a fairly typical pattern after major disasters. Job shortfalls persist in government, leisure & hospitality, retail, health, and education. In contrast, employment rose to new highs in construction and professional & business services; unemployment is near a record low. The US Virgin Islands saw much steeper job losses and less of a rebound. Employment still down roughly 8% more than a year after Irma & Maria. The key tourism sector remains depressed leisure & hospitality employment is still down 40%, accounting for 2/3 of the net job shortfall. 21
Index (Month before hurricane = 100) 105 Employment Paths Post-Hurricanes Index (Month Before Hurricane = 100) USVI Hugo (1989) 100 95 90 PR Maria (2017) USVI Marilyn (1995) USVI Irma/Maria (2017) 85 80 New Orleans Metro Katrina (2005) 75 70-3 -2-1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Months before/after hurricane Source: U.S. Bureau of Labor Statistics, Moody s Economy.com, and FRBNY staff calculations. 22
Regional Recap Business sentiment rebounded in February, following a slump. NYC continues to lead the region in job growth. Fairfield County and much of upstate New York have lagged. Even in the weakest areas, unemployment is near record lows. NYC s key securities industry has barely contributed to the city s boom; but brisk growth in a variety of other sectors, notably tech, has contributed to a broad-based expansion. Home prices appear to have leveled off across much of the District. Puerto Rico s economy has rebounded, while the USVI s remains depressed. 23