More New York City businesses are looking to return after the prolonged Covid-19 shutdown. Though the infection rates remain excellent, the prolonged economic shutdown continues to wreak havoc on the city. The Department of Labor statistics announced July’s unemployment rate in New York City was around 20%, a slight decrease from June but a large increase from the 16% rate of July 2019. The Bronx continues to be hit particularly hard as unemployment in the borough sits at almost 25%.
There are 646,100 fewer jobs in the city this year than there were in 2019. Over 150,000 of which are restaurant and jobs, as about half the 300,000-person workforce remains unemployed. Despite this, neither Mayor de Blasio nor Governor Cuomo is prepared to give a timeline or guidelines for indoor dining. The state did announce that the Federal Emergency Management Agency (FEMA) approved a grant to fund an additional $300 in weekly unemployment benefits.
Hospitality is not the only major New York City industry struggling mightily right now. The commercial real estate sector, partially due to the hospitality and retail pain, has seen over $54 billion in US commercial mortgage-backed securities transferred to loan workout specialists due to payment delinquencies. A 320% increase since the start of the pandemic. Now, this does not automatically lead to foreclosures. Loans transferred to specialists do sometimes end in payment modifications, including about $4 billion since the pandemic began. Currently, many large real estate investors have stopped paying hotel and retail debt while trying to raise capital from new investors.
Lastly, there is the residential real estate market which is surging around the county. New home sales are at their highest level since 2006. Unfortunately, this spike comes at the expense of the Northeast as that region has seen a staggering 23% decrease in sales.