New York’s unemployment rate saw a significant spike as large numbers of job seekers poured into the city, new analysis shows.
The unemployment rate jumped to 6.6% in August, even as New York City gained approximately 24,000 new jobs, according to the “Center for New York City Affairs”, analyzing data from the New York State Department of Labor.
In August there were 108,000 unemployed New Yorkers more than before the pandemic began, noted Patch.com. The analysis also found an increase in labor force participation, that is, the percentage of residents working of working age, stimulated by an influx of job seekers, which reached 24.9%, according to the economic update.
The increase stands in strange contrast to employers who say they are having trouble finding entry-level candidates, said James Parrott, director of Fiscal and Economic Policy at the center that conducted the study.
“The steady increase in labor force participation is difficult to reconcile with anecdotal reports from employers about difficulty filling vacancies in many entry-level fields,” Parrott wrote.
“The picture is complicated by the fact that the size of the city’s total workforce remains 272,000 below the pre-pandemic level”. Parrott suggested that despite the growth, the city is still dealing with a shortage of jobs rather than a shortage of applicants.
Many NYC stores and restaurants have said they cut their hours due to lack of staff, further exacerbated by insecurity.
The report also found a decrease in real wage gains due to the highest inflation in several decades in the country. “Employers who are unable or unwilling to increase salary offers may be the ones experiencing the greatest hiring challenges,” according to Parrott.
A growing discrepancy was also found between salary increases in the top and bottom end of the economy. A comparison of the first quarters of 550 and 2020 shows that wages in the financial sector increased by more than 22%, while wages in the food and service industry experienced a drop of 1.4%. The full analysis is available here.