New York City Recovery Index: October 19

Editor's note: Below you'll find the week 13 release of the NYC Recovery Index, originally published Oct. 19, 2020. Visit the NYC Recovery index homepage for the latest data.

New York City took more small steps towards a full economic recovery in the past week as a surge in pending home sales and more dining out helped boost the NYC Recovery Index to a reading of 55 out of 100. It’s the highest reading for the index, developed in partnership with NY1, since early march before the pandemic was officially declared.

The Recovery Index jumped 7 points week-over-week, driven by gains in the real estate component, and while other metrics showed slight increases, most are still well-below their pre-pandemic levels.

New COVID Hospitalizations Slightly Higher

Despite an uptick in positive coronavirus cases over the past several weeks, especially in Brooklyn and Queens, new hospitalizations for the virus remained stable. It’s a good sign that the recent spate of illnesses did not necessarily require emergency hospitalizations. The 7-day average for new COVID hospitalizations was 42 per-day last week, which was a slight increase from the prior week.

Unemployment Down Slightly

Unemployment continues to be among the biggest factors holding back the city’s overall economic recovery. While initial unemployment claims for newly laid-off workers fell slightly last week from the week prior, 38,929 people filed for first-time claims last week. Overall, private sector jobs in New York City fell by 583,000 in September, and nearly 4 million city residents are unemployed, according to the NY State Labor Dept.

New York City’s unemployment rate was 14.1% in September, a decline from 16% in August. The job losses continue to concentrate in the leisure and hospitality sectors, where 225,888 people lost their jobs in September, but also in Professional Services, where 98,500 New Yorkers lost their job last month.

Pending Home Sales Soar

The residential real estate market continues to be one of the few bright spots in the New York City economy. Pending home sales, or homes under contract, regained strength from the prior week, rising 44% across all boroughs according to data from StreetEasy. Brooklyn, with a 64% increase in pending sales from the same period a year ago, continues to be the strongest part of the city, with Queens and Manhattan still showing robust activity. 

The New York City rental markets for both apartments and commercial real estate, however, are both deeply compromised. According to data from Douglas Elliman and Miller Samuel, the number of apartments for rent in Manhattan tripled in September, with nearly 16,000 apartments sitting empty.

According to the report, there were 15,963 apartments for rent in September, up from 5,299 a year earlier. The vacancy rate in Manhattan, which is typically 2% to 3%, is now nearly 6%. 

As for commercial real estate, data from Optimal Spaces for August (the most recent available) showed a further weakening through the summer as leasing volume fell 21% from August of 2019. The vacancy rate for Manhattan office space hit a seven-year high, as sublease space and new construction came onto the market.

Subway Ridership Remains Low

Straphangers are slowly coming back to public transportation in NYC, as the subway mobility index increased just under 1% last week. The return of public schools to in-person classes helped boost the index, but subway ridership is still 68% below the same period a year ago.

Restaurant Reservations Show a Slight Gain

Restaurant reservations, as measured by OpenTable, showed a slight increase last week, but cold, rainy weather limited the gains. Many restaurants are now allowing indoor dining at 25% capacity in addition to other safety measures, but the industry is suffering from a lack of tourists, business customers and overall demand. Restaurant reservations were down 75% from the same period last year, but up slightly from the week of October 3.

Thousands of restaurants have been forced to close their doors either permanently, or temporarily due to pandemic. The Grand Central Oyster Bar was among the most recent iconic NYC restaurants to suspend its operations indefinitely. The Oyster Bar tried to reopen on September 30 with 25% capacity, but soon closed their doors again due to the overall loss of revenue.