Editor's note: Below you'll find the week 40 release of the NYC Recovery Index, originally published May 11, 2021. Visit the NYC Recovery index homepage for the latest data.
New York City’s economic recovery saw exceptional improvement week-over-week as of May 1, as the New York City Economic Recovery Index reached an all-time high of 75.6. The biggest index improvements were seen in unemployment insurance claims and COVID-19 hospitalizations, both of which are on the decline. Notably, the only component of the index with a marked decline was subway ridership.
As the city continues its vaccine rollout, vaccination rates will remain the primary driver of maintaining declining coronavirus hospitalizations, rising restaurant reservations, and declining UI claims.
New York City’s recovery stands at 75 out of a total score of 100, according to the New York City Recovery Index, a joint project between Investopedia and NY1. The index rose 12.3 points from the prior week, marking the largest week-over-week increase since the beginning of the pandemic. Thirteen months into the pandemic, and New York City’s economic recovery is now roughly three-quarters of the way back to early March 2020 levels.
COVID-19 Hospitalizations Continue Decline
The Covid-19 hospitalization rate in NYC fell for the fifth straight week as of May 1, and the trailing 7-day average now sits at 105 people, which is 26 hospitalizations fewer than the average last week. The 7-day average in the city has not been this low since November 19th of last year. There continues to be a general trend in the decline in COVID-19 hospitalizations in the city which is now tracking pretty closely to declines nationwide.
As vaccinations are now open to all adults, and children over the age of 16 in New York City, it seems to be only a matter of time until continued inoculations begin to make even more significant dents in the COVID-19 hospitalization rates.
As of May 11, New York State has vaccinated 40% of the population and 50.4% of the currently eligible population (all adults). New York State is also on pace with vaccination numbers from the last week to achieve 70% vaccination in August of 2021, placing it 19th out of 59 states, DC, and US territories according to Verywell Health's vaccine distribution tracker.
Unemployment Claims Continue to Fall
The estimated unemployment insurance claims rate declined by 9% week-over-week. Though this is a major positive change, it was enhanced significantly by unemployment claims for this week in 2019 being over 2X greater than normal. This is a sign that though UI claims city-wide are trending in a positive direction, there will likely be a correction in the weeks to come.
Home Sales Remain Flat
Pending home sales stayed effectively flat as of May 1, but still sit at around 66% higher than 2019 levels. The home buying market has been running higher than normal for New York City since last August, and is the only index measure to do so consistently. There were 742 pending home sales for all of New York City last week, compared to 447 during the same week last year.
Rental Vacancies Increase
Meanwhile, the rental market saw a slight increase in vacancies week-over-week, but only by 51 residences. Despite the minor increase, this is actually fewer than what would be expected for the vacancy rate change as we move into summer, subsequently causing the index measure score to increase by three points.
As NYC recovers from the COVID-19 pandemic, the housing market will be watchful for an influx of residents moving in throughout the summer months of 2021, hopefully to counterbalance the many departures in 2020.
Subway Ridership Isn’t Ramping Up for Summer
Subway ridership had a small correction week-over-week as the seven-day trailing average of riders now sits at almost 62% below 2019 levels. MTA estimates a trailing 7-day average of just over 1.83M riders for the week of May 1.
Though there was an increase of about 1,000 riders in the trailing average week-over-week, this increase was under what we would expect to see heading into summer, which is why the score declined. In the next three weeks as schools let out for the summer rounding into Memorial Day, ridership would normally be expected to increase further.
Restaurants See Small Increase
Restaurant reservations experienced a small positive increase as of May 1, as they rose throughout the city and caused the score to increase by about a point. OpenTable estimates that the trailing 7-day average of seated diners in NYC sits just over 67% below 2019 levels. The restaurant industry in New York City has now seen consistent increases in the reservation rate in five of the last six weeks.
If increases in reservations continue, we could see rates that end up dwarfing the ~65% to 75% year-over-year declines from much of the summer of 2020, particularly as the city aims for a full-capacity restaurant reopening by May 19, according to NY State Governor Andrew Cuomo.
The restaurant and hospitality industry in New York was devastated by the pandemic, particularly due to the lack of tourism in the past year. According to New York State Comptroller Thomas DiNapoli, 43.7 million fewer visitors came to the city in 2020 because of COVID-19. Tourists spent only $13 billion in 2020, a 73% decline from the prior year which will cost the city $1.2 billion in lost tax revenues in Fiscal Year 2021.