Economy

in New York City

America is a country of widespread disparities in wealth and wages. For some, opportunities and progress are limitless. For others, living on the margins is a way of life. The economic crisis of 2008 set back many Americans, even those who were doing well. Job losses and shocks to the stock market transformed the economic landscape and made financial stability that much harder to attain. For the disadvantaged, who were already struggling, 2008 was a further jolt and reminder of how hard it is to make it in America.

Our indicators under the Economy theme explore how disadvantaged groups like racial and ethnic minorities, women, those involved with the criminal justice system, and those with disabilities, experience significant disparities in the topic areas of Poverty, EmploymentIncome and Benefits, and Business Development.

You can see a snapshot of the indicators averaged in this theme in the chart to your right and then visit the sections below for more detail and additional findings.

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Poverty

Roughly half (45.2%) of NYC’s population was living below the NYCgov poverty line in 2014. Employment is considered the best buffer against poverty, but even those who are employed are vulnerable to poverty. To understand Poverty as a function of inequality, we used four indicators:
  • Race & Poverty
  • Race & Food Security
  • Citizenship Status & Poverty
  • Family Composition & Poverty
Take a look at the chart to your right for an overall picture of this topic, and then look at each indicator and the scores in context for more detail and additional findings.

Indicators within Poverty

  • Race & Poverty

    What is Measured?
    Ratio between the percentages of Asians and whites living below the poverty line.

    What’s the Backstory?
    Poverty can have pervasive, debilitating effects on adults and children. In the US, whites have a much lower poverty rate than other racial and ethnic groups do. Although blacks have the highest rate of poverty nationwide, Asians and Hispanics have the highest rates in NYC.

    What Did We Find?
    Asians had the highest NYCgov poverty rate of all racial and ethnic groups in the current year (24.1%), followed closely by Hispanics (23.9%) and blacks (19.2%). Whites had the lowest poverty rate by far (13.4%). The poverty rate decreased for all groups from baseline, but the disparity between Asians and whites remained almost unchanged. In the current year, poverty also varied by borough, with the highest rate in the Bronx (25.0%), followed by Brooklyn (20.5%), Queens (19.2%), Staten Island (16.9%), and Manhattan (13.9%).

  • Race & Food Security

    What is Measured?
    Ratio between the percentages of Hispanics and whites with low or very low food security.

    What’s the Backstory?
    Hunger and poor nutrition can have severe consequences for people’s health and wellbeing and jeopardizes children’s development and learning. In the US, food insecurity is disproportionately high among racial and ethnic minorities, children, the elderly, and in low-income households.

    What Did We Find?
    The rate of low or very low food security continued to be highest for Hispanics (23.4%), followed closely by blacks (19.2%). Low or very low food security was least likely among whites (6.4%), while the rate among Asians fell in the middle (11.7%). Rates decreased from baseline for Hispanics (from 29.3%), blacks (from 24.3%), and whites (from 8.5%), but increased for Asians (from 10.7%). When looking specifically at children, Asian children were the most likely to experience low or very low food security (12.4%), followed by black (12.2%), Hispanic (9.9%), and white (8.3%) children. Food security also varied by disability status: 31.2% of individuals with disabilities experienced food insecurity, compared to 11.3% of those without disabilities.

  • Citizenship Status & Poverty

    What is Measured?
    Ratio between the percentages of non-citizens and citizens living below the poverty line.

    What’s the Backstory?
    Poverty has severe, pervasive effects on people’s health, education, employment opportunities, and housing, and on children’s development. Nationwide and in NYC, immigrants, particularly those who are not US citizens, have substantially higher levels of poverty than citizens do.

    What Did We Find?
    The NYCgov poverty rate for non-citizens (26.5%) was almost 1.5 times higher than the poverty rate for citizens (18.0%), a slightly smaller disparity than in the baseline year, when 29.5% of non-citizens and 18.9% of citizens lived in poverty. In the current year, naturalized citizens were also more likely to live below the poverty line (19.1%), compared to citizens by birth (17.6%). Poverty rates also varied by educational attainment: those with less than a high school diploma were most likely to live in poverty (31.5%), compared to those with a high school diploma (22.9%), some college (16.9%), and a bachelor’s degree or higher (8.0%).

  • Family Composition & Poverty

    What is Measured?
    Ratio between the percentages of people in single-parent and two-parent households living below the poverty line.

    What’s the Backstory?
    Poverty has damaging short- and long-term effects for children and adults. It affects almost every area of life, from health to education to criminal justice outcomes. Nationwide, people in single-parent households are markedly more likely to live in poverty than those in two-parent households.

    What Did We Find?
    Almost one in three (29.2%) people in single-parent households lived below the NYCgov poverty line in the current year, compared to 16.0% of those living in dual-parent households. Poverty rates for both groups remained similar to the baseline year, and there was negligible change in the disparity. Poverty was particularly pervasive among children: just under one in four (22.2%) children lived in poverty, compared to 18.3% of individuals aged 18-64, and 20.8% of those 65 and older.

Employment

Stable, full-time employment at a livable wage is out of reach for many New Yorkers. Those with disabilities and justice-involved individuals are particularly vulnerable to unemployment. Minority communities are especially hard-hit by persistent unemployment and the negative side effects that spill over into neighborhood life. To understand Employment as a function of inequality, we used four indicators:
  • Race & Unemployment
  • Disability & Unemployment
  • Probation Status & Unemployment
  • Employment Assistance
Take a look at the chart to your right for an overall picture of this topic, and then look at each indicator and the scores in context for more detail and additional findings.

Indicators within Employment

  • Race & Unemployment

    What is Measured?
    Ratio between the unemployment rates for blacks and whites.

    What’s the Backstory?
    In addition to its importance to individuals’ and families’ wellbeing, the unemployment rate is a reflection of the labor force and the broader economy. In the US and in NYC, the unemployment rate among blacks is dramatically higher than the rate among whites.

    What Did We Find?
    The unemployment rate was highest for blacks (7.2%), followed by Hispanics (4.7%). The group with the lowest unemployment rate in the current year was Asians (2.4%), followed by whites (3.8%). Unemployment decreased from the baseline year for blacks (from 9.7%), Hispanics (from 8.1%), and Asians (6.6%), but increased for whites (from 3.5%), contributing to the smaller disparity between blacks and whites in the current year. There were also disparities based on educational attainment: the unemployment rate among those without a high school diploma was 10.1%, compared to 5.2% for those with a high school diploma and 3.1% for those with a bachelor’s degree.

  • Disability & Unemployment

    What is Measured?
    Ratio between the unemployment rates for people with and without disabilities.

    What’s the Backstory?
    Employment is important to most adults’ quality of life and that of their families, and it is one measure of the state of the labor force and the broader economy. Nationally and in NYC, people with a disability have a higher unemployment rate than those without a disability.

    What Did We Find?
    The unemployment rate among people with disabilities (14.7%) was higher than the rate among those without disabilities (6.0%). Unemployment decreased from baseline for both groups, but the disparity between the two got slightly worse. Employment status varied by type of disability: 23.6% of individuals with cognitive disabilities were unemployed, compared to 13.7% of those with hearing difficulty, 13.1% of those with vision difficulty, and 12.7% of those with ambulatory difficulty. It is important to note that more than half of people with disabilities (58.8%) were not in the labor force, and not included in these rates, compared to 21.0% of those without disabilities.

  • Probation Status & Unemployment

    What is Measured?
    Ratio between the unemployment rates for probation clients and the general population.

    What’s the Backstory?
    A criminal record often creates numerous barriers to employment, even eliminating eligibility for some jobs. More than 3.9 million adults are on probation in the US, and this population has a substantially higher rate of unemployment than people not under such supervision.

    What Did We Find?
    We saw a large decrease in the reported unemployment rate among those on probation, dropping from 62.4% in the baseline year to 44.2% in the current year. While there is reason to believe that unemployment has decreased among people on probation , the magnitude of the change is also driven, in part, by improvements in the process of collecting and reporting employment data at the Department of Probation. Previously, employment data was only collected once during the probation intake process, and last year the Department began regularly updating the employment status of those on probation as they gained employment. However , unemployment for the general population also decreased from baseline, leading to an increase in the disparity between the two groups and a static score remaining at 1.

  • Employment Assistance

    What is Measured?
    Percentage of cash assistance recipients who were no longer employed 180 days after being placed in a job.

    What’s the Backstory?
    Research suggests that programs that offer financial incentives, job coaching, and advice after job placement may improve job retention and earnings. Thus, programs that combine cash assistance with employment services may increase job retention and earnings, and help reduce poverty.

    What Did We Find?
    In fiscal year 2018, a total of 593,900 people received cash assistance from HRA and 105,300 received emergency assistance. In addition to monetary benefits, HRA provides employment assistance to current and former recipients of cash assistance. Approximately one quarter (26.2%) of current or former cash assistance recipients were no longer employed 180 days after HRA had helped them to obtain employment, demonstrating a continued lack of employment stability. These numbers have remained almost unchanged from the baseline year.

Income and Benefits

Workers in NYC comprise the majority of NY State’s minimum wage workers (61%). NY State’s 2016 passage of a $15 minimum wage means that employers in NYC must incrementally raise the wages of their minimum wage employees on a yearly basis to reach the $15 threshold (the tiered system is based on size of employer). For low-income workers, many of whom represent minority or immigrant groups, this is a step forward. But in an expensive city like NYC, many still struggle with paying for necessities like housing and food, despite working full-time hours. Retirement, among these workers, is often little more than a fantasy as they cannot put money from wages aside for the future. To understand Income and Benefits as a function of inequality, we looked at four indicators:
  • Race & Income
  • Income & Retirement Savings
  • Immigration Status & Income
  • Gender & Income
Take a look at the chart to your right for an overall picture of this topic, and then look at each indicator and the scores in context for more detail and additional findings.

Indicators within Income and Benefits

  • Race & Income

    What is Measured?
    Ratio between the median yearly personal incomes for Hispanics and whites.

    What’s the Backstory?
    In the US and in NYC, an ongoing gap between the income of whites and both blacks and Hispanics contributes to disparities in poverty rates. Blacks and Hispanics who are full-time workers disproportionately earn poverty-level incomes and also have fewer assets.

    What Did We Find?
    Hispanics continued to have the lowest median annual income ($38,400), compared to blacks ($40,144), Asians ($44,404), and whites ($70,000). Median income increased from baseline for both Hispanics (from $30,075) and whites (from $59,875), but Hispanics experienced a larger increase, which reduced the disparity between the two groups. Blacks also had a higher median income (up from $35,000 at baseline), while median income dropped for Asians (from $49,002). There were also large racial and ethnic differences in full-time hourly wages: the median hourly wage for whites was $29.26, compared to $19.23 for Asians, $18.27 for blacks, and $17.79 for Hispanics.

  • Income & Retirement Savings

    What is Measured?
    Ratio between the percentages of people in the bottom and middle income groups who do not have retirement or pension plans.

    What’s the Backstory?
    Retirement and pension plans increase future financial security, and people with higher incomes are more likely to have them than people with lower incomes. Saving for retirement is important for all income groups, but it is especially critical for middle- and low-income individuals.

    What Did We Find?
    Large income-based disparities in retirement savings persisted in the current year: 82.6% of those making less than $30,000 per year indicated that they did not have a retirement or pension plan, compared to 14.2% of those in the middle income group (those making $70-100,000 per year). While there was a slight improvement in the disparity, both groups were less likely to have retirement savings than in the baseline year. There were also racial and ethnic disparities: almost two-thirds of Hispanics (63.0%) and Asians (62.7%) reported not having a retirement or pension plan, compared to 48.6% of blacks and 41.7% of whites.

  • Immigration Status & Income

    What is Measured?
    Ratio between the median yearly personal incomes for foreign-born and US-born individuals.

    What’s the Backstory?
    People who immigrate to the US have substantially lower incomes than those born in the country, even when they have comparable education and work experience. Although this gap narrows over time as immigrants live and work in the US, it does not disappear.

    What Did We Find?
    The median personal income of full-time workers born in the US ($57,000) was more than 40% higher than that of foreign-born, full-time workers ($40,000). Incomes for both groups increased from baseline, but they increased more for those born in the US, resulting in a slight increase in the disparity between the two. Among immigrants, those who are naturalized citizens had a higher median income ($42,254) than those who are non-citizens ($35,001). When looking at median hourly wage, US-born workers had the highest wage ($25.00), compared to foreign-born, naturalized citizens ($19.71) and non-citizens ($14.42).

  • Gender & Income

    What is Measured?
    Ratio between the median yearly personal incomes for women and men.

    What’s the Backstory?
    In the US, women earn about 80% of what men do for full-time work, and this is true across most fields and occupations and isn’t explained by differences in education. The gap increases with age and is more pronounced for black and Hispanic than for white and Asian women.

    What Did We Find?
    While median income increased for both genders in the current year, the gender pay gap has widened from the baseline year because men’s income increased more than twice as much as women’s. As a result, median yearly income for women working full time this year ($45,000) was about 20% less than the median yearly income for men working full time ($55,006). The gender disparity persisted at different levels of educational attainment: among those with less than a high school diploma, men earned $30,000 on average while women earned $26,000, and among those with at least a bachelor’s degree, men earned $79,984 while women earned $60,929. There was also a gap in median hourly pay, with men earning an hourly wage of $24.04, compared to $20.00 for women.

Business Development

Entrepreneurship is the engine of NYC’s economy. New businesses create jobs, revitalize neighborhoods, and provide people, especially women and members of minority groups, with a self-sustaining path to financial independence. A closely watched measure of inequality is the number of City contracts awarded to Minority & Women Owned Business Enterprises (MWBEs). Mayor de Blasio has promised to award 30% of City contracts to MWBEs by 2021, creating a task force in 2015 to ensure progress is being made in meeting that goal. To understand Business Development as a function of inequality, we used four indicators:
  • Race/Gender & City Contracts
  • Race & Business Ownership
  • Gender & Business Ownership
  • Location & Business Revenue
Take a look at the chart to your right for an overall picture of this topic, and then look at each indicator for more detail and additional findings.

Indicators within Business Development

  • Race/Gender & City Contracts

    What is Measured?
    Ratio between the percentages of small versus large contracts going to minority and women-owned business enterprises.

    What’s the Backstory?
    In the US, women and racial and ethnic minorities face greater challenges to starting and maintaining a business than white men. Minority and women-owned business enterprise certification should increase access to government opportunities, but it may not lead to City contracts.

    What Did We Find?
    Of the 6,829 City-certified MWBEs in fiscal year 2018, 1,396 (20.4%) were awarded City contracts. MWBEs still tend to be awarded smaller contracts: 46.7% of contracts with values less than $100,000 were awarded to MWBEs, compared to 20.9% of contracts with values over one million dollars. The percentages of contracts awarded to MWBEs increased in both categories from the baseline year, when 24.0% of small contracts and 13.6% of large contracts were awarded to MWBEs, but the disparity between the two increased. We note that these data exclude City contracts for goods, because all goods contracts are less than $100,000 dollars in value.

  • Race & Business Ownership

    What is Measured?
    Ratio between the percentages of blacks and whites who are business owners.

    What’s the Backstory?
    Starting a business fuels economic development and can help alleviate income disparities for racial and ethnic minorities. In the US, blacks and Hispanics own businesses at much lower rates than whites and Asians do, and when they do, their businesses are typically smaller and have less favorable outcomes.

    What Did We Find?
    Blacks remain the racial and ethnic group least likely to be business owners at 1.4%, compared to 2.3% of Hispanics, 4.4% of Asians, and 6.0% of whites. The disparity between blacks and whites increased in the current year due to a decrease in business ownership among blacks (from 1.7% at baseline) and an increase in business ownership among whites (from 4.9%). There were also disparities by marital status: married individuals were more likely to be business owners (5.4%) than those who were divorced (4.2%), widowed (3.9%), separated (2.4%), or never married (2.1%).

  • Gender & Business Ownership

    What is Measured?
    Ratio between the percentages of women and men who are business owners.

    What’s the Backstory?
    Owning a successful business benefits individuals, their families, and communities, and can alleviate income disparities. The number of businesses owned by women has grown in NYC and the US; however, they are still in the minority among business owners, and women business owners face greater challenges than men when accessing capital to grow their businesses.

    What Did We Find?
    From baseline to the current year, business ownership rates for both men and women increased and the gender gap narrowed, resulting in a moderate increase in score for this indicator. However, men (4.8%) are still nearly 1.8 times more likely to own businesses than women (2.7%). The business ownership rate also varied across the five boroughs: the business ownership rate was highest among those residing in Manhattan (5.0%) and Staten Island (5.0%), followed by Queens (3.8%), Brooklyn (3.5%), and the Bronx (1.9%).

  • Location & Business Revenue

    What is Measured?
    Ratio between the percentages of sales tax collected from businesses located outside and within Manhattan.

    What’s the Backstory?
    Business development fuels economic growth by creating new jobs, and successful businesses contribute to employment, self-sufficiency, and prosperity. An increase in the proportion of business taxes paid in given parts of a jurisdiction reflects business development in those areas.

    What Did We Find?
    Manhattan continues to generate the majority of sales tax collected from the five boroughs (63.1%), generating more than 1.7 times the percentage of sales tax collected from all other boroughs combined (36.9%). This disparity has remained relatively stable from baseline to the current year, with a negligible change in score. Within the outer boroughs, 15.8% of sales tax was collected from Brooklyn, 14.2% was collected from Queens, 4.8% was collected from the Bronx, and 2.0% was collected from Staten Island.