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ECONOMIC NOTES
SHARP ECONOMIC DECLINE IN FOURTH QUARTER OF
2002
SEASONALLY ADJUSTED PAYROLL JOBS PLUNGED 29,000
New York City remained in recession during the fourth
quarter of 2002, according to the latest issue of Economic Notes,
a publication issued by the office of New York City Comptroller
William C. Thompson, Jr.
“While the national economy has grown moderately in each
of the last five quarters since September 11, the City’s economy
continues to decline, placing it in the eighth consecutive quarter
of negative real growth,” said Comptroller Thompson. “Seasonally
adjusted payroll jobs fell by 29,000 in the fourth quarter, of which
17,500 were in the private sector. In addition, the inflation rate
increased to 3.1 percent in the fourth quarter from 2.6 percent
in the third quarter. This is the fourth-highest rate among the
14 largest metropolitan areas. It is imperative that we work to
quickly decrease the burden this recession has placed on our budget.”
The gross city product, a measure of economic activity in New York
City, fell by 1.9 percent in the fourth quarter, reflecting declines
in payroll jobs and real incomes. In comparison, the national economy
grew by 1.4 percent for the same period. For 2002, GCP fell by 2.2
percent compared with 2.4 percent growth for the national economy.
The latest issue of Economic Notes also reports the following New
York City data:
- Payroll Jobs in 4Q02, seasonally adjusted, fell by 29,000 or
3.2 percent from the previous quarter. Private jobs fell by 17,500.
Compared with 4Q01, not adjusted for seasonal fluctuations, jobs
fell 1.3 percent, the eighth-weakest performance of the 20 largest
metropolitan areas. On a yearly basis, payroll jobs fell by 91,600
in 2002 after declining 20,900 in 2001. The private sector lost
88,300 jobs in 2002 compared with a loss of 15,100 in 2001. In
2002, NYC had the third-highest rate of job decline of the 20
largest metropolitan areas.
- Personal Income Tax (PIT) revenues, a proxy for personal incomes,
fell 2.9 percent in 4Q02 over 4Q01. Estimated taxes decreased
40.0 percent, reflecting lower dividends and capital gains. Withholding
taxes increased 1.2 percent. U.S. PIT revenues fell 12.7 percent
in 4Q02. In 2002, NYC PIT revenues fell 16.9 percent and U.S.
PIT revenues fell 17.1 percent.
- The Inflation Rate in the New York metropolitan area was 3.1
percent in 4Q02, up from 2.6 percent in 3Q02. This is the fourth-highest
rate among the 14 largest metropolitan areas.
- The Unemployment Rate in NYC, seasonally adjusted, rose to
8.1 percent in 4Q02. The U.S. unemployment rate, also seasonally
adjusted, rose to 5.9 percent in 4Q02 from 5.7 percent in 3Q02.
The City’s unemployment rate averaged 7.7 percent in 2002,
1.6 percentage points above the 6.1 percent in 2001.
- Leading Indicators for the City were mixed. The Help-Wanted
Ads Index dropped to 18.3 in 4Q02, the lowest in more than 50
years. The Help-Wanted Ads Index fell 32.7 percent in 2002, slightly
better than the 38.6 percent decline in 2001. The number of building
permits rose 2.4 percent in 4Q02 from 4Q01. In 2002, permits issued
were up 4.4 percent from a year earlier.
Summary Table. Five Key Economic Indicators, NYC and U.S., 4Q02
and 2002 vs. 2001
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1. GCP/GDP Growth, SAAR |
2. Payroll-Jobs Growth, SAAR |
3. Personal-Income-Tax Growth, NSA |
4. Inflation Rate, NSA |
5. Unemployment Rate, SA |
| NYC |
4Q02 |
-1.9% W |
-3.2% W |
-2.9% B |
3.1% W |
8.1% W |
| U.S. |
+1.4% W |
-0.2% W |
-12.7% W |
2.2% W |
5.9% W |
| NYC |
2002 |
-2.2% W |
-2.5% W |
-16.9% W |
2.5% N |
7.7% W |
| U.S. |
+2.4% B |
-0.9% W |
-17.1% W |
1.6% B |
5.8% W |
B=Better than prior period. N=No change. W=Worse. Indicators 1, 2,
5 (SA) compare 4Q02 with 3Q02; indicators 3-4 (NSA) compare 4Q02 with
4Q01. NSA=Not Seasonally Adjusted. SA=Quarterly Data Seasonally Adjusted.
SAAR=SA Annualized Rate.
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