Editor's note: Below you'll find the week 41 release of the NYC Recovery Index, originally published May 25, 2021. Visit the NYC Recovery index homepage for the latest data.
New York City’s economic recovery experienced a substantially positive week as of May 15, showing an eight point improvement to a score of 74. This is the second week that the index has breached 70, and the sixth straight week above 60. The index's increase was mainly due to a positive turn in the unemployment insurance (UI) rate as well as a return to high home sale levels. Elsewhere, every other measure, including COVID-19 hospitalizations, restaurant reservations, rental vacancies, and subway usage, had at least a slightly positive week.
With summer unofficially starting after Memorial Day next weekend, and vaccination rates still rising — albeit at a substantially lower rate than anticipated — there is a hope that NYC might be able to reach approximately 70% inoculation against COVID-19 so that restaurant reservations, subway usage, and the rental market can all swing into their busy season as unencumbered as possible. The midnight closing time for outdoor dining areas expired on May 17, while the indoor dining curfew will come to an end on May 31. However, many businesses across the city are still operating at limited hours.
New York City’s recovery stands at 74 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 eight points from the prior week. More than one year into the pandemic, NYC’s economic recovery is now roughly two-thirds of the way back to early March 2020 levels.
COVID-19 Hospitalizations Down Yet Again
New York City experienced a decline in COVID-19 hospitalizations for the seventh straight week, reporting a rolling seven-day average of 52 hospitalizations per 100,000 people for the week of May 15, which is down by 16 hospitalizations from the prior week’s average. The city’s seven-day average hasn’t been this low since Nov. 2 of last year. There continues to be a decline in coronavirus hospitalizations in the city, which is now mirroring declines seen nationwide. NYC has recorded a total of 946,610 cases and 33,146 deaths, as of May 24.
New York state has vaccinated approximately 45.3% of the population and 57.2% of the currently eligible population (i.e, all adults), as of May 24. The state is on pace to achieve 70% vaccination in August of 2021 — placing it 16th out of 59 U.S. states, municipalities, and territories — according to VeryWell Health. Both Governor Andrew Cuomo and Mayor Bill de Blasio are currently offering several perks to help convince the reluctant, unvaccinated population to get their shots, including free Yankees tickets, “vax & scratch” lottery tickets, free subway and railroad rides, and tickets to popular attractions (i.e., zoos, gardens, etc.).
Unemployment Dipped Significantly
The estimated initial UI claims rate in New York City stands at 28% above 2019 levels for the week of May 15, which represents a significant decline from the week prior. This was one of the best UI weeks since the onset of the pandemic in March of 2020. However, as UI claims tend to fluctuate somewhat substantially week-to-week, the next two weeks’ rates will be telling as to whether or not this reduction in claims is going to be part of a sustained trend.
Summer is generally a low point seasonality-wise for UI claims. With the lifting of further business hours restrictions and a general increase in economic activity, claims should track downward within the next few months if a recovery is underway.
Home Sales Exceed 800
During the week of May 15, pending home sales experienced a year-over-year (YOY) improvement and now sit 71% higher than 2019 levels. The home buying market is still running higher than normal YOY for New York City since last August, and it is the only index measure to do so.
There were 802 pending home sales in NYC for the week of May 15, according to StreetEasy. This is 12 more homes than were pending in the previous week, and the first time since the start of the pandemic that the raw pending sales number was over 800.
Rental Vacancies Decrease
Although New York City’s rental market has borne the brunt of the COVID-19 pandemic compared to home sales, the former now appears to be experiencing consistent positive drops in vacancies. As of the week of May 15, NYC rental vacancies declined by 447 units week-over-week. This decline in vacancies pushed the rentals index up by another point and to its best score since June 13, 2020.
With five straight weeks of solid improvements heading into summer’s typically active real estate market, the rental index now appears to be rising in concert with other measures, such as restaurant reservations and COVID-19 hospitalizations.
Subway Ridership Back on Track
Subway ridership experienced another positive increase week-over-week during the week of May 15. The seven-day rolling average was approximately 58% less than during the same period in 2019. The Metropolitan Transportation Authority (MTA) reported an estimated rolling seven-day average of just over 1.93 million riders on public transport, which is approximately 5,000 more riders on average than the week prior.
With Memorial Day next week, subway ridership being on the upswing is a positive sign that the typical trend of high seasonal usage will continue this year.
Restaurants Rose Once More
Restaurant reservations experienced another rise as of May 15, increasing the index by three points. OpenTable estimates that the trailing seven-day average of seated diners in New York City sits at just over 61% lower than the same period in 2019. The restaurant industry has now seen positive movement in the reservation rate compared to 2019 levels in seven of the last eight weeks.
We are now breaking away from the roughly 65% to 75% decline in dining reservations seen last summer, as the city inches its way back to the popularity of outdoor summer dining. Future trends throughout the next few months will be critical for determining whether restaurants can potentially increase their capacity along with the warmer weather, a rise in vaccinations, and/or a decline in cases.