January 22, 2010 NY Times
City's Jobless Rate Rises to 10.6%, Exceeding Nation's By PATRICK McGEEHAN <http://topics.nytimes.com/top/reference/timestopics/people/m/patrick_mcgeeh an/index.html?inline=nyt-per> The unemployment rate in New York City jumped in December to 10.6 percent, its highest level in nearly 17 years, as hotels, museums and builders eliminated jobs and hiring remained weak in most other businesses, the State Labor Department said Thursday. Last month marked the first time since the recession <http://topics.nytimes.com/top/reference/timestopics/subjects/r/recession_an d_depression/index.html?inline=nyt-classifier> began two years ago that the city's unemployment rate was significantly higher than the nation's. The city's rate rose from 10 percent in November, while the national rate held steady at 10 percent last month, according to the Labor Department. Nearly 425,000 city residents were unable to find jobs in December, easily the highest total in the 33 years those records have been kept. The numbers were announced a day after New Jersey officials said that their state's unemployment rate hit a 33-year high of 10.1 percent in December. New York State's unemployment rate also rose, to 9 percent from 8.6 percent in November. "The city's rate is obviously the most disturbing one in the mix," said M. Patricia Smith, the state labor commissioner. "What this shows is that the economy is still volatile. People are still nervous about the economy." Analysts said the unemployment rate could continue rising and was not likely to reverse direction before midyear. After the last two recessions, employment in the metropolitan area did not begin to rise for at least 10 months, said James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University <http://topics.nytimes.com/top/reference/timestopics/organizations/r/rutgers _the_state_university/index.html?inline=nyt-org> . "We're not going to see a return to job growth before the middle of 2010 - if we're lucky," Dean Hughes said. "The small-business sector still has severe credit problems. Banks simply aren't lending to them. If they don't get credit, they certainly aren't going to be able to start hiring again." The numbers reflected the damp blanket the long recession cast over the city during the holidays. The city's restaurants and catering operations shed about 2,000 jobs in December, a month when the hospitality industry usually adds to its payroll. Stores in the city added about 4,500 jobs in the month, but for the entire holiday season, retail hiring still lagged behind its usual pace, said James Brown, a Labor Department analyst. Still, Mr. Brown said, "Christmas '09 as a whole was actually an improvement from last year's disastrous holiday season." Mr. Brown said one bright spot in the data was an apparent turnaround on Wall Street. Financial-services companies had been among the first to make sharp cuts in employment as the recession deepened. Those layoffs reverberated throughout the regional economy because the jobs paid so highly and supported so many workers in other service businesses. Now, with some of the big investment banks racking up huge profits again, they have begun to hire selectively. Wall Street firms added about 1,000 jobs in December, though total employment in finance was still down by more than 16,000 positions from the end of 2008, the data showed. "It looks like they might be bottoming out," Mr. Brown said. Statewide, more than 610,000 residents were collecting unemployment insurance at the end of the year. More than half of them had been collecting benefits for more than six months. "The fact that we have so many more people on unemployment is evidence of the fact that they need the benefits longer," Ms. Smith said. Signaling that the worst is not over, state labor officials are about to start contacting employers in the city and on Long Island that they fear might soon resort to layoffs. Using emergency federal funds, they will offer to help the companies avert or minimize job cuts, Ms. Smith said.
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