March 05, 2009 3:48 PMby: Daniel Massey
Job losses wiped out more than 30% of New York City’s job gains since the end of the last recession.
The city has seen a net loss of 85,400 jobs since the labor market peaked in August, wiping out 32% of the job gains made since the end of the last recession in 2003, according to an analysis of New York State Department of Labor data by real estate services firm Eastern Consolidated.
After adjustments to last year’s data, the city’s unemployment rate fell to 6.9% in January, from 7% in December, the state labor department reports. But the January 2009 figure was significantly higher than in January 2008, when unemployment was 4.8%. The number of unemployed city residents jumped to 290,600 in January 2009, up 41% from a year earlier.
The sharpest losses since August were in financial activities, construction, and business and professional services, which eliminated a combined 48,600 jobs.
“It’s a pretty widespread decline, and it’s pretty obvious it’s going to get worse in the months ahead,” said James Brown, principal economist at the labor department.
One rare bright spot: Educational and health services, which remained the strongest sector, gained 6,400 jobs since August.
Mayor Michael Bloomberg has said he expects the city to lose nearly 300,000 jobs in this recession, more than the 222,700 that were shed from the 2001-03 downturn and on par with the 330,300 jobs lost when the 1987 stock market crash sparked an economic tailspin through the early 1990s.
At the state level, job-market conditions also deteriorated rapidly toward the end of 2008. As recently as the third quarter of 2008, the state was adding almost 70,000 private-sector jobs on a year-over-year net basis. But newly revised data show the private-sector count plummeted after peaking in the summer: About 111,300 private sector jobs were eliminated between August and December.
More recently, in January, the city lost only 300 private-sector jobs and 3,100 public-sector jobs, the Eastern Consolidated analysis shows, relatively modest losses compared to other recent months. The only industry with a significant loss was securities, which shed 4,200 jobs in January, bringing the total loss since Wall Street’s December 2007 high to 15,400.
January’s moderate loss was more a statistical fluke than a reversal in the downward direction of the economy, according to Barbara Byrne Denham, chief economist at Eastern Consolidated. The previous four months each saw an average loss of more than 20,000 jobs, and Ms. Denham expects the bad run to continue.
“The city,” she wrote, “should continue to see job losses of 10,000 a month, on average, for the next year and further.”
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