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The Gathering Storm: Challenges Facing the Future of New York
Introduction: New York State is Entering a Period of Consequences
“The era of procrastination, of half-measures, of soothing and baffling expedients, of delays, is coming to a close. In its place we are entering a period of consequences. ” Winston Churchill (1874 - 1965)
These words of Winston Churchill have as much meaning now as they did when he first wrote them over a half century ago.
New York State is facing one of the greatest challenges in our history. After decades of over spending, over taxing, over regulating and over mandating, New York State is beginning to bare the burden of past decision making and procrastination that have lead to the economic decline of our great state.
There are warning signs everywhere of the gathering storm we are about to confront.
Since the year 2000, almost 1.5 million people have left New York State for other parts of the country that offer greater economic opportunities than does our State. Although these population losses have been mitigated in part by an influx of new immigrants from abroad, 33 Upstate New York counties still have lost population in the past 7 years, resulting in a percentage growth rate of the state’s population which ranks 43rd in the nation.
New York’s population is growing older, with one of the lowest percentages of its population below the age of 18 in the country. According to the US Bureau of the Census, 22.9% of the State’s population is below the age of 18, ranking 40th when compared to other States. If the 50 counties of Upstate New York outside of the 12 county New York City metropolitan area were a separate state, it would rank 48th in the nation.
Our senior citizen population is growing, with 13.2% of the population attaining the age of 65 years and over as compared to 12.6% for the nation as a whole. Upstate New York has 14.3% of its population age 65 and over, which would have the 7th highest percentage of senior citizens in the country if it were a separate state.
The future trends appear to be equally as grim. A recent study conducted by the Wharton School at the University of Pennsylvania forecasts that 17 of the top 50 counties in population loss in the nation by the year 2020 will be New York counties.
Projections made by research professionals from Cornell University and the United State Bureau of the Census, although different in their methodology and findings, also project continuing population loss and overall decline of the State’s leadership position in the nation because of the loss of congressional representation in Washington.
We have lost an entire generation, particularly from Upstate New York, in a steady exodus of population to other parts of the country after decades of lagging job growth and corporate flight to more business friendly states.
In this time of economic uncertainty, NYSAC has launched a new monthly publication, the Economy Watch, to provide county officials with a summary of leading economic indicators, so that they will be able to more clearly articulate to their State representatives how the way our State does business affects our local economies and the people who live there.
This information will be updated constantly, and will contain information about each county, whenever county level data it is readily available, through the NYSAC Website at www.nysac.org.
New York has lagged behind the nation in private sector job growth over the 10 year period between 1997 and 2007, ranking 34th in the nation according to a recent report of private sector job growth compiled by the Public Policy Institute, the research and policy arm of the Business Council of New York State.
For most of the past year, New York State has not experienced the full effects of the national recession sweeping the nation, with total non-farm jobs and private sector jobs declining at less than the national rates. New York State’s unemployment rate has also remained below the pace of the rest of the nation through most of 2008.
Employment growth and unemployment statistics released by the New York State Labor Department for the month of December 2008, however, do indicate that the full brunt of the recession has finally manifested itself in New York.
New York lost 49,300 Private sector jobs in December and a total of 102,900 in the last quarter of 2008 alone. Since December 2007, New York has lost 120,600 private sector jobs, or over 21% of the total private sector jobs created in New York in the previous 10 years.
The State Unemployment Rate, after seasonal adjustment, increased by a full percentage point for the month, growing from 6.0% in November to 7.0% in December, the largest one month increase in the unemployment rate since the Department began issuing seasonally adjusted unemployment rates in 1976.
There are also signs that this trend will continue, with the State’s receipt of over 90 WARN notices in the last quarter of 2008 that announced employers’ intentions to eliminate almost 13,000 additional jobs in the next 60 days.
If New York is to reverse its recent history of stagnant growth, and in many areas of the State significant population loss, we will need to find ways to ride out the national crisis and position ourselves for a strong economic recovery fueled by new business and job growth in the years ahead.
New York, however, has a long way to go. Rankings of New York State as a place to do business by major business publications sends a clear message to New York’s decision makers that we must change or we will continue on our current road of ruinous economic decline.
The financial news network CNBC ranks New York State as the most expensive state in the nation in which to do business. Forbes ranks the state 49th in its business cost rankings. CEO Magazine ranks us 50th and the national Small Business & Entrepreneurship Council ranks New York State’s tax burden 44th.
As we enter the period of consequences brought on by the State’s economic crisis, county leaders need to be more informed about what is happening in the economy and adamant in calling for a fundamental change in how this State manages its affairs.
During this report, we will discuss many of the challenges confronting New York as foretold by information from the US Bureau of the Census and other research organizations.
We will also discuss many of the indicators utilized to measure what is happening in the national and state economy and provide you with information on how they are developed, what they say about the economy and what they mean for all of New York
We are entering a period of consequences. The time when we can continue to ignore our problems, and delay the implementation of the drastic reform this State sorely needs is long past.
New York is fast approaching a fork in our path through history. The path we are on leading to continued economic decline and stagnant population growth, the other to greater prosperity and renewal of our standing in the nation as the State of Innovation, the Empire State.
The path we take is ours to choose.Download the full Gathering Storm report (PDF).
Download the Executive Briefing (PDF).
Table of Contents
Introduction: New York is entering the period of consequences
Chapter 1:The Changing People of New York: A look at the makeup of New York’s population
Chapter 2: Poverty in New York
Chapter 3: The People of New York’s Future: An examination of population projections of New York’s population up to 2030
Chapter 4: Implications for New York: What do all these factors mean for New York?
Chapter 5: The state of the New York Economy: What the Economic Indicators say about New York
Chapter 6: Doing Business in New York: What business publications say about doing business in New York
Chapter 7: Are these the shadows of the things that will be?