NY Unemployment Increases For Third Straight Month

For the third month in a row, New York’s unemployment rate increased, according to numbers released on Thursday by the Department of Labor.

The statewide employment rate in October stood at 5.2 percent, an increase from September’s 5 percent unemployment rate. In August, unemployment stood at 4.8 percent.

In a release, the DOL put a rosier spin on the numbers, noting the state’s overall job count in the last year climbed 1.1 percent.

“Looking over the past year, the New York State economy has added 89,900 private sector jobs,” said Bohdan M. Wynnyk, Deputy Director of the New York State Department of Labor’s Division of Research and Statistics.

But as E.J. McMahon at the Empire Center notes, the growth rate is lower than the 1.7 percent federal rate over the last 12 months.

Statewide Unemployment Ticks Upward

New York’s unemployment last month increased from 4.8 percent in August to 5 percent in September, the Department of Labor announced on Thursday.

The New York unemployment rate of 5 percent is the same as the overall nationwide unemployment rate of 5 percent.

The Department of Labor’s announcement, however, sought to put a rosy spin on the numbers, pointing to a year-over-year gain in jobs of 115,100 between September 2015 and last month.

Overall last month the private-sector job count decreased by 4,400.

Tax Foundation: NY Ranks 49th In Biz Tax Climate (Updated)

New York ranks at the bottom when it comes to its business tax climate, according to an annual report released on Wednesday by the Tax Foundation.

The report ranked New York 49th overall in business taxes, sandwiched between two other notoriously high-tax states, California (48th) and New Jersey (50th). For what it’s worth, the states with the best tax climate for businesses are Wyoming, South Dakota and Alaska.

The ranking comes after years of Gov. Andrew Cuomo’s administration pushing to reshape the image of the state as having a high-tax climate or being generally hostile to businesses.

“The states in the bottom 10 tend to have a number of shortcomings in common: complex, non-neutral taxes with comparatively high rates,” the foundation wrote in its report. “New Jersey, for example, is hampered by some of the highest property tax burdens in the country, is one of just two states to levy both an inheritance tax and an estate tax, and maintains some of the worst-structured individual income taxes in the country.”

Business groups, meanwhile, lamented the development.

“The Tax Foundation has released its annual State Business Tax Climate Index and the results are troubling and frustrating,” said Greg Biryla of Unshackle Upstate. New York State has the second-worst business tax climate in the nation. That’s simply unacceptable. If a well-respected research organization published a report that had similar findings about our educational or health care systems, the outcry would be deafening and Albany would go to great lengths to address the situation.”

Updated: The Cuomo administration responds.

“New York has a fair and progressive income tax structure that this conservative leaning organization fundamentally disagrees with,” said spokesman Rich Azzopardi.

“Thanks to Governor Cuomo’s reforms, we also have the lowest middle class tax rates in 70 years, the lowest manufacturing tax rate since 1917 and the lowest corporate tax rate since 1968, and a tax cap that broke the cycle of skyrocketing property tax hikes on businesses and property taxpayers alike.”

New York’s Unemployment Ticked Upward In August

New York’s unemployment rate increased in August, but still remains below the national average, the state Department of Labor on Thursday announced.

New York’s unemployment rate last month increased to 4.8 percent in August, up slightly from 4.7 percent in July.

That’s still below the national unemployment rate of 4.9 percent.

Still, the Labor Department sough to emphasize the positive, pointing to the 12 months of job growth from August 2015 through last month.

“Looking over the past year, the New York State economy has added more than 120,000 private sector jobs and our statewide unemployment rate has dropped by 0.2 percentage points. In addition, in August 2016 the state’s jobless rate remained below the nation’s comparable rate,” said Bohdan M. Wynnyk, Deputy Director of the New York State Department of Labor’s Division of Research and Statistics.

Hochul: ‘Very Optimistic’ About START-UP NY

Lt. Gov. Kathy Hochul remains optimistic on the prospects of the START-UP NY economic development program after a report released by the Empire State Development Corp. last week found the tax-free incentive program has created only 408 jobs over the last two years.

Hochul in western New York on Tuesday said the claim the program was isn’t living up to expectations is inaccurate.

“I disagree with that assessment 100 percent,” she said. “In fact, from 2014 to 2015 there’s been an over 300 percent increase in the number of jobs created. We went from 76 in our inaugural year, when you have those early growing pains, which we experienced and expected. We have over 300 jobs now and that’s really over 18 months.”

The report itself was released on the afternoon of July 3 and weeks after it was initially scheduled to be released. Gov. Andrew Cuomo did not address questions raised about the report in New York City earlier in the day.

Hochul, who has been charged with overseeing economic development opportunities, insisted the program needs time to gain steam and attention from out-of-state investors.

“As I’ve said before, this takes time to germinate,” she said, adding, “We’re really at the early stage of this, so I’m very optimistic about what’s occurring.”

First approved in 2013, START-UP NY aims to provide tax-free incentives to business that come to New York and create jobs. The program has been heavily advertised in TV ad campaigns, but has been criticized by conservatives and liberals alike for its approach to economic development as too costly.

Hochul, however, pointed to interest from international business leaders when she recently touted the program in Washington, D.C.

“They were fascinated to learn more, so I feel really good about our prospects for future growth,” she said. “It’s only been here for 18 months. So, people have to understand something like this doesn’t grow exponentially over months.”

At the same time, it may take several more years for the benefits of START-UP NY to become apparent, Hochul said.

“I think we’re looking at a five year strategy here,” Hochul said, “so let’s have that conversation in a couple of years.”

NY Unemployment Ticks Up Amid Lower Job Growth

The state’s unemployment rate ticked upward in April from 4.8 percent to 4.9 percent after a month of relatively flat growth in private-sector jobs.

New York’s unemployment rate is still lower than the national average of 5.5 percent.

And the Department of Labor sought to claim a positive, given the overall private-sector job count has grown to a record 7.9 million. Still, employers in April added only 13,300. In April of 2015, the private-sector job count grew by 18,300.

“New York State’s labor market continued to strengthen in April 2016, reaching a new record high in private sector jobs as the state’s growth outpaced national job growth for the month,” said Bohdan M. Wynnyk, Deputy Director of the Division of Research and Statistics.

The private-sector job count is based on a payroll survey of 18,000 employers conducted by the U.S. Department of Labor’s Bureau of Labor Statistics.

UPDATED: SolarCity Developer Says Payments Will Come Early Next Week

UPDATE: SolarCity Developer LP Ciminelli now says they have been told the payments due to contractors will be disbursed “first thing next week.” In a statement sent to TWC News Buffalo, the developer says they will be reaching out to contractors over the weekend to reverse the layoffs and get workers back on the project next week.

“As the developer for the landmark RiverBend Solar City project, we’ve been assured that the funding will be dispersed the first thing next week,” a statement from LP Ciminelli read. “We will begin getting in touch with contractors this weekend with the expectation that workers will be back on the job and the project’s construction schedule will remain on course.”

State Senator Tim Kennedy says he was told by a local union Friday afternoon that they were asked to lay off 144 employees at the SolarCity construction site in Buffalo. That was after he was told by the governor’s office and Empire State Development that no layoffs were expected.

“Our office received assurances from the state as recently as this morning that there would be no layoffs at the Solar City site,” Kennedy said in a statement. “This afternoon, we received word from Plumbers and Steamfitters Local 22 that they were told by a subcontractor on the site to lay off 144 workers as of 4:30 p.m. today. I am furious; this development is unacceptable and should be corrected immediately to prevent work delays and ensure no one is laid off. We’ve been in constant communication with the administration throughout yesterday evening and today to ensure that this situation is immediately rectified, and I won’t rest until the payment issue is corrected and the workers are back on schedule.”

News of potential layoffs broke Thursday night after WGRZ in Buffalo reported $75 million was owed in contract payments from the state.

Empire State Development released a statement shortly after the report saying the state was currently processing those payments.

“Payments are being processed and as a result we do not expect this to result in any layoffs,” ESD Spokesman Jason Conwall said in a statement. “This project remains on schedule and is still slated to be open in the Third Quarter of 2017, bringing nearly 1,500 new jobs to Western New York.”

UPDATE: Empire State Development issued an updated statement Friday evening, repeating that the payments were being processed and “all stakeholders agree this project will remain on schedule and is still slated to open in the Third Quarter of 2017.”

A source told our affiliate station in Buffalo Thursday night that there had already been layoffs at the Riverbend site prior to the initial report from WGRZ and more were expected Friday.

American Rated Cable and Communications, which is doing work on the site, told TWC News Buffalo Thursday night that they were still waiting to be paid but were not concerned about it. State Senator Tim Kennedy said in an interview Friday morning that he was told by the governor’s office payments would be made soon.

“We have been in touch with the governor’s office and ESD about this,” Kennedy said. “We have received assurances that there will be no layoffs and that everyone is going to get paid.”

Kennedy also said that before the report Thursday night, they did not know payments had not been made.

“I can tell you that prior to this report coming out last night we were unaware of this situation,” Kennedy said, “and now that we have this information we are going to be working aggressively expedite the payments.”

UPDATE (3:45): Northeast Regional Council of Carpenters confirmed to Time Warner Cable News Buffalo this afternoon that several dozen workers are being laid off from Mader Construction Company, a sub-contractor on the project.

UPDATE (4:00): Former Gubernatorial Candidate and Westchester County Executive Rob Astorino weighed in on the situation in Buffalo Friday afternoon.

“The project has been a house of cards since day one,” Astorino said in a statement. “Taxpayers are massively subsidizing a private company that is losing billions of dollars solely for the purposes of shoring up political support for the Governor and to pay off his big donors. The state must do the right thing and fulfill their obligations, but this is a glaring and very expensive example of the Governor’s economic development failures.  Fix what’s wrong with the state – corruption, sky-high taxes and strangling regulations – and then watch how we will flourish.”

UPDATE (6:00): The union that confirmed the layoffs at Mader earlier today issued a statement later in the afternoon expressing hope for payments to come though.

“We are pleased with the response from the state and are assured that the state is working to resolve these issues immediately and any layoffs will be short lived,” said Daryl Bodewes from the Northeast Carpenters Union.

Farm Bureau Pushes Back Against $15 Minimum Wage

Chief among the priorities for the New York Farm Bureau in the new legislative session includes opposing Gov. Andrew Cuomo’s proposal to increase the state’s minimum wage to $15.

The Farm Bureau outlined its 2016 agenda on Wednesday with opposition to the wage proposal ranked as the “number one issue” for the organization this year.

“The Governor’s minimum wage proposal makes New York completely uncompetitive with the other agricultural states,” said Farm Bureau President Dean Norton in a statement. “When Pennsylvania’s minimum wage is $7.25 and New York’s is $15, how can our farms and other businesses compete? The answer, unfortunately, is to reduce labor costs or shut down.”

Cuomo has marshaled a coalition of labor groups and poverty advocates to back a coalition that’s push for the minimum wage increase in the new legislative session.

Opposition to the proposal has come primarily from business groups who have said a wage increase to $15 would do more harm than good for the state’s economy and employment rate.

The current minimum wage in New York is $9, having increased from $8.75 on Jan. 1.

Cuomo last year backed a minimum wage increase to $15 that would be phased in over several years for various sectors of employment, including fast-food workers as well as employees of the state and SUNY system.

Senate Majority Leader John Flanagan has said he remains concerned about increasing the wage to $15, but has not ruled out a wage hike at some point this session.

Unshackle Upstate Releases 2016 Agenda

The business-backed Unshackle Upstate on Thursday released its 2016 policy agenda for the coming legislative session that pushes for a strengthening of the tax cap and reductions in taxes for small businesses.

“While the Upstate economy has made some modest gains in recent years, there’s much more work to be done,” said Executive Director Greg Biryla. “Our 2016 agenda focuses on important policies that will help grow our economy. Cutting taxes for all New Yorkers, addressing regulatory burdens and improving the state’s overall business climate will generate good-paying jobs and a brighter future for Upstate New York.”

The group, based in Rochester, is backing a permanent cap on property taxes (the measure was renewed alongside rent control regulations for New York City earlier this year) as well as a permanent extension of the personal income tax actions taken in 2011.

Unshackle is also backing a 10 percent personal income tax reduction for small businesses with incomes of $500,000 or less, as well as a 10 percent PIT exemption for small businesses with less than 100 employees.

The group’s biggest fight, however, is likely to be over a proposal backed by Gov. Andrew Cuomo that would increase the state’s minimum wage to $15 over the next several years. Cuomo this summer moved administratively to raise the wage to $15 for workers in the fast-food industry.

“Now that we have some momentum on our side, it makes no sense to go backwards. The opposition items that we’ve detailed in this year’s agenda would erode the recent economic progress,” said Biryla. “The impact of a $15 minimum wage alone would jeopardize at least 200,000 jobs and squeeze $15 billion from employers, consumers and taxpayers. That’s simply unaffordable and unacceptable.”

Uu 2016 Policy Agenda by Nick Reisman

Counterpoint On Minimum Wage And Inflation

minwagechartYesterday in this space we pointed out an inflation analysis that supporters of increasing the state’s minimum wage have used as justification for a $15 target over the next several years.

E.J. McMahon, the president of the Empire Center for New York State Policy, has a contrary view.

In his analysis, based on the Bureau of Labor Statistics handy inflation calculator, a $1.85 minimum wage translates to $11.35 in today’s dollars.

When projecting that rate of growth — 2.5 percent a year — the 2021 figure comes to $13.16.

McMahon points out the average New York minimum wage in 2015 dollars over the past half century has been $8.38.

“Again — I don’t assume this persuades anyone one way or another; if you want $15 and insist on believing it will make absolutely no economic difference, this won’t talk you out of $15,” he notes. “So be my guest. But the implication that we somehow strayed from the right minimum wage path and need to get back on it is really far-fetched. A $15 minimum wage would be far beyond the historic norm by any conventional standard. (FDR’s original 25-cent minimum was $4.20 in today’s terms.)”

And then there’s this point on using inflation dating back to 1970.

“PS — The economy of the late 1960s through 1970s was, um, not so hot—especially in New York State,” he wrote. “Correlation isn’t causation, but I’d point out that the minimum wage has never been higher than it was during this period.”

Updated: I’ve included a chart McMahon sent along. And as regarding the comment below, this was from an email he sent over in response to Wednesday’s minimum wage item.