New York By The Numbers: Monthly Economic and Fiscal Outlook


** New York by the Numbers
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** Monthly Economic and Fiscal Outlook
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Photo Credit: Ryan DeBerardinis/Shutterstock
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** No. 76 - April 11th, 2023
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** A Message from the Comptroller
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Dear New Yorkers,

The cherry blossoms and tulips let us know we’re well into April now, but unfortunately the New York State Fiscal Year 2024 budget – due on March 31^st – still hasn’t bloomed. We’re waiting to see what the State budget agreement will mean for New York City: will it help us meet the growing cost of providing shelter and services for asylum-seekers, or will it cost the city hundreds of millions through cost-shifts?

Three years after the pandemic began, the data tells us that economic patterns are largely stabilizing following dramatic changes, with employment back at 99.5% of pre-pandemic levels, workers and employers settling into hybrid schedules, impacted industries like accommodations and food services returning, with low office occupancy and high residential rents becoming a new normal.

Our Spotlight this month looks at newly available data on changes in personal income tax liabilities in the first two years of the pandemic ([link removed]) . The numbers show that New Yorkers making under $50,000 saw aggregate incomes rise in 2020 due to pandemic-era unemployment and economic stimulus payments, as we explored in our January Spotlight ([link removed]) . Unfortunately, those gains were largely erased in 2021 as enhanced pandemic benefits ended, just in time for inflation to raise the cost of living.

Meanwhile, the highest income filers, New Yorkers making over $25 million (fewer than 1,000 households, though it varies annually), saw aggregate income gains of nearly $62 billion over those two years, driven primarily by capital gains from the booming stock market (although it has since been on the decline). That $62 billion was 73% of the city’s total income growth, to less than 1-in-5,000 of its households.

According to recent numbers from Forbes, New York City has reclaimed its status as home to the most billionaires of any city on the planet (107, worth $640 billion), and the most millionaires, too. A recent report from the Institute on Taxation and Economic Policy found that New York is home to both the highest concentration of extreme wealth and the highest income inequality in the U.S.

According to the “New New York” Panel convened by Governor Hochul and Mayor Adams (and chaired by former Deputy Mayors Doctoroff and Buery), the way to keep New York’s economy growing – but share prosperity better – in the face of our post-pandemic challenges is to invest in transit, housing, child care, and the public realm. Those investments, they argue, will keep wealthy New Yorkers here, while also making it possible for a much broader set of New Yorkers to be able to afford to live, work, and raise families here.

The New New York Panel didn’t say where we could find the money to pay for those investments. This month’s “Spotlight ([link removed]) ” brightly illuminates one answer.

Sincerely,
Brad Lander


** Table of Contents
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** The U.S. Economy ([link removed])
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** NYC Labor Markets ([link removed])
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** Housing ([link removed])
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** Office Market ([link removed])
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** City Finances ([link removed])
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Read the Full April Economic Newsletter ([link removed])


** Spotlight:
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** NYC Personal Income Tax 2019-2021
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Despite economic disruption and population loss, tax revenues from New York City’s Personal Income Tax (PIT) increased by 11% in each of the first two full fiscal years following the start of the COVID-19 pandemic (FYs 2021 and 2022).

This month’s Spotlight examines return data from the New York State Department of Taxation and Finance that reveal some of the principal sources of income growth among NYC residents in this period and shed further light on income distribution in the City and the pandemic’s impact. The data show income gains and increased personal income tax liabilities that are dominated by capital gains realizations and concentrated among the top 1% of tax filers. However, NYC revenue from capital gains-driven income tax liabilities for tax year 2022 are expected to decrease due to a declining stock market.
Read the Spotlight ([link removed])
Read the Full April Economic Newsletter ([link removed])

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