New York City’s Economy Grew at 3% Rate in First Quarter, Report Finds – Wall Street Journal

Job growth pushed New York City’s strong economy, though the increase wasn’t as high as in the last quarter of 2018. Photo: Spencer Platt/Getty Images

New York City’s economy remained strong in the first quarter of the year, buoyed by record-low unemployment, according to a report by Comptroller Scott Stringer.

The city’s economy grew 3% in January through April, said the report, which was released Monday. And while officials said the growth follows a steady increase in the city’s economy during the past two decades, Mr. Stringer cautioned that leaders should be ready for any future downturn.

“Given that growth will inevitably slow, we must ensure we are prepared as a city to meet changing circumstances without disruptions to vital services for New Yorkers,” he said in a statement.

The comptroller has called for the city to boost its reserves, which he reiterated this year during the city’s budget negotiations. Mayor Bill de Blasio, a fellow Democrat, initiated cost-savings programs across city agencies this year, the first time since he took office in 2014, but the city’s $92.5 billion budget is still the biggest in history.

Job growth pushed the city’s strong economy, though the increase wasn’t as high as in the last quarter of 2018. Private companies and organizations, as well as the government, added 18,800 jobs, a 1.6% increase. That is lower than the 28,800 jobs created at the end of 2018.

The largest increase in jobs came in health care and social assistance, with 10,800 new positions. Of those, 6,500 specifically were in home health-care services. This rise is likely from a change in Medicaid that allows family members to get paid to care for their home-bound relatives, the comptroller’s office said.

Unemployment declined for the fifth straight quarter, with the average unemployment claims decreasing 6.4% since the previous quarter, the report shows. The city’s lowest unemployment numbers are in Queens, with a rate of 4%. The Bronx has the city’s highest unemployment rate, at 6.2%, while unemployment is at 4.7% in Brooklyn, 4.1% in Manhattan and 4.5% on Staten Island.

The average hourly earnings were up 4.5%, compared with the same time last year, from $35.84 to $37.43. Venture-capital investment also hit a record high, with $4.46 billion in investments in the first quarter.

Despite a strong economy, the report highlighted some concerns. Spending only grew 1.2%, which the report attributed to increases in consumers’ health-care and insurance costs. The financial sector lost 3,100 jobs during the first quarter, which comes after a loss of 1,500 positions in the final quarter of 2018. The decline, officials said, reflects the industry’s stronger reliance on financial technology and the automation of some jobs.

Jane Meyer, a de Blasio spokeswoman, said the administration’s investments created stronger neighborhoods across the city. “We will continue to build an economy that uplifts all New Yorkers,” she said in a statement.

Appeared in the May 21, 2019, print edition as ‘Economy Grew at 3% Rate In Quarter.’