New York City's unemployment rate rocketed from 5.1 percent in May 2008 to 9 percent in May 2009. While this is less than unemployment in some other cities around the country, it still takes a human toll often not conveyed by the grim statistics emanating from the U.S. Department of Labor.
To gain a better understanding of how this terrible recession is impacting New York City's residents, I took a closer look at the unemployment numbers and found that the recession's impacts have fallen most heavily on a number of specific groups including men, African-Americans, prime-age workers, and the well-educated.
During the early stages of this recession, New York City's economy seemed to defy the laws of gravity and reason. While the nation's job total peaked in December, 2007, the city continued to climb right through the summer of 2008.
But local job growth came to an abrupt end in September with the failure of Lehman Brothers and the ensuing financial panic. Since that time, the city's workers have shared fully in the nation's labor market miseries, with over 108,000 jobs evaporating citywide between August, 2008 and May, 2009. Unfortunately, Mayor Bloomberg's administration put all of its financial eggs in the Wall Street basket, and the basket broke.
Typically, unemployment continues to climb even after the economy bottoms out and begins to recover. I expect the number of unemployed in New York City to reach 400,000 in 2010, for the first time in decades.
This will directly affect the economic well-being of over 1 million New Yorkers. It is often forgotten that unemployed workers are usually members of larger households, and their loss of income directly affects, on average, 2.2 other people.
Even more troubling is the fact that people are unemployed for longer spells since, while new jobs are created even during recession, there are fewer of them, and there is lower turnover in existing positions.
From the first quarter of 2008 to the first quarter of 2009, the number of people unemployed for at least 27 weeks more than doubled. When considering the consequences of long-term unemployment, let's not forget that the median value of American families' liquid assets -- money in checking and savings accounts and money market funds--is less than $4,000.
Two groups have been especially hard hit by this downturn. Shockingly, unemployment among black New Yorkers has risen four times faster than among other ethnic groups, pushing their unemployment rate to 14.7 percent in the first quarter of 2009, compared to 13.7 percent nationally.
Additionally startling is the degree to which the present recession has affected prime working-age males, especially those with higher levels of education. Men have accounted for over 70 percent of the growth in the city's unemployed since early 2008.
Many of the unemployed will have been the sole earners in their households. In the first quarter of 2009, my office estimated that there were about 75,000 unemployed people in the city who were the sole earner in the household prior to becoming unemployed. Until they are re-employed, this group is the most economically vulnerable and potentially most in need of public income support programs.
One might think that New York, with its reputation as a bastion of liberalism and generosity towards the poor, would provide a better cushion for its unemployed residents than many of our sister states.
In fact, maximum benefit levels in New York State are lower than in adjoining states and even lower than benefits in some states with a much lower cost of living, such as Kansas and North Carolina.
Among the many failures in our State Capitol this summer is an effort to bring unemployment insurance benefits into line with our neighbors. Even if this important task is eventually accomplished, many of the unemployed will still find themselves ineligible for benefits at a time when they may need those most.
William C. Thompson, Jr. is the Comptroller for the City of New York.