New York City’s economic recovery remained fairly stagnant as positive trends in subway ridership, restaurant reservations, and pending home sales were brought down by increased COVID-19 cases and a higher rate of unemployment compared to the same period last year. As of Nov. 19, all NYC public school buildings were closed until further notice, and all students were learning remotely full time.
New York City’s recovery stands at just 50.7 out of a total score of 100, according to the New York City Recovery Index, a joint project between Investopedia and NY1. The index improved by 1.5 points from the prior week, but has been stuck in the same range since August.
COVID-19 Hospitalizations Continue to Increase
NYC saw a sizable increase in the number of COVID-19 hospitalizations for the week of Nov. 14 with an average of 67 hospitalizations per day, up from 55 average daily hospitalizations the prior week. This was the highest weekly average recorded since May 20 as cold weather and relaxed social-distancing practices have brought in a new wave of COVID-19 cases. New York City recorded 299,000 total COVID-19 cases as of Nov. 22. Mayor Bill deBlasio closed all public school buildings and transitioned students back to full-time remote learning on Nov. 19. The rising number of cases comes as many Americans visit friends and family for Thanksgiving. Experts fear the increased travel might amplify COVID-19 cases and hospitalizations going forward.
Unemployment Claims Continue to Fall
The downward trend in initial unemployment claims since September has continued during the week of Nov. 14, with 20,456 claims filed during the week, a decline of 1,167 from the previous week. Nonetheless, the number of first-time claims is still 290% higher than the same period last year. As we head into winter, potential future shutdowns due to renewed COVID-19 spikes might reverse the positive trend that has been occuring throughout the fall.
New York City's unemployment rate decreased from 13.9% in September to 13.2% in October according to the NY Department of Labor. The unemployment rate was 3.2% in October of 2019. Outside of New York City, the unemployment rate increased from 6.6% to 6.9%. The hardest hit sectors continue to be Leisure and Hospitality, which saw another 329,000 job losses statewide in October.
Pending Home Sales Pick Up
Pending home sales, or homes in contract, increased modestly during the week of Nov. 14 and are now up 19% year-over-year. Across New York City, 494 homes went into contract during the week of Nov. 7, compared to 491 the previous week, according to data from StreetEasy. Manhattan, Queens, and Brooklyn all saw notable increases for the week, with each borough up 15%, 22%, and 27%, respectively.
Rental Listings Beginning to Plateau
While we have yet to include apartment rental prices in the index, the decline in rental prices reflects New York City’s struggling economic recovery. After a summer of record-breaking rental inventory on the market, the number of listings is starting to plateau in the fall. CityRealty reported 20,524 listings throughout Manhattan, northern Brooklyn, and western Queens as of Nov. 20. In Manhattan alone, the overall listing count fell 4% to 15,498 and the median rent dropped 5% to $3,114 for the borough. Tribeca and NoHo remain the most expensive neighborhoods.
Subway Ridership Remains Stagnant
Subway ridership remained stagnant compared to the previous week at 1.5 million riders for the week of Nov. 14, down 67% year-over-year, according to data from the MTA. The MTA is currently facing a $6.1 billion funding shortfall for 2021, well more than a third of next year’s $16.1 billion budget, largely due to decreased ridership. The agency has threatened to curtail service, lay off employees, and eliminate monthly metrocards if it does not receive aid in the near future.
Restaurants See Improvement
Restaurant reservations increased slightly during the week of Nov. 14, however the estimated number of seated diners was still 77% lower compared to the same period last year, according to OpenTable. Questions regarding the feasibility of outdoor dining during the winter months and consumers’ desire to eat out during a rise in COVID-19 cases might hamper any future potential gains in reservations. The New York State Restaurant Association found that more than 60% of restaurants could close by 2021 if the state does not provide a comprehensive relief package specifically for restaurants. More than 1,000 NYC restaurants have already shuttered their doors since the pandemic began in March.