Health insurance coverage up in New York

September 12, 2012. One piece of good news from the Census Bureau data released today is an increase in the percentage of people with health insurance in New York State and across the country in 2011.

The share of New Yorkers without health insurance dropped last year, according to preliminary state Census Bureau figures. Roughly one in eight New Yorkers did not have health insurance coverage in 2011, a decrease of three percent from 2010. A similar, though less pronounced, change was seen around the United States. In the country as a whole, the share of people without health insurance coverage decreased by less than one percent.

Most of the change in New York is due to an almost 3 percent increase in Medicaid coverage accompanied by much lesser but contributing growth in Medicare coverage and employer-provided health insurance. For children under 18 years of age, there was a decline of only 1.5 percent in those who were not covered by health insurance.

The continuing slow economic recovery may explain the increase in Medicaid coverage in New York in 2011. At the same time, the young adult provision in the Affordable Care Act, in effect since September 2010, has held private coverage steady for the nation and has increased such coverage in New York State. The erosion in private coverage over time remains a concern that various provisions of the ACA scheduled for implementation in 2014 are intended to address.

FPI’s Senior Fiscal Policy Analyst, Carolyn Boldiston, said, “It’s impressive to see health-care coverage expand at a time when the economy is still so weak. It just shows the importance of government policy, really making a difference in New Yorkers’ lives.”

These figures are one-year estimates from the Census Bureau’s Current Population Survey. The CPS asks about health insurance during the previous year (“entire year”). A person uninsured at the time of the survey but insured at a different point during the year is identified as insured in the CPS.

Link to pdf of charts.

16 percent in the Empire State lived in poverty – two years running

September 12, 2012. Earlier today, the U.S. Census Bureau released its Current Population Survey (CPS) poverty estimates for 2011 for the nation and the 50 states. The release also included revised estimates for 2010.

The overriding message of the poverty data released today is that the poverty rate remains much too high – demonstrating the continuing impact of the Great Recession and the tepid and tenuous economic recovery. (The poverty rate is the percentage of people living below the federal government’s official poverty levels. In 2011, for example, the poverty level averaged $11,484 for single individual households and $17,916 for three-person households.)

In New York, in the nation as a whole, and in most other states, the Census Bureau’s estimates of the two-year average poverty rates for 2010 and 2011 are higher than Census’s two-year estimates for the preceding recession years (2008 and 2009). For the nation as a whole, the Census Bureau estimates that the poverty rate increased by a statistically significant 1.3% from 13.8% in 2008-2009 to 15.1% in 2010-2011. In New York the increase during this same period was also statistically significant, up from 15% to 16%.

These high poverty rates show the pressing need to both strengthen the social safety net and stimulate the economy. There is plenty that the federal and state governments can do. Prime examples include modernizing the unemployment insurance system, avoiding the senseless cuts in Food Stamp funding now being proposed in Congress, and reversing the state and local government layoffs and service cuts that are placing a significant drag on the private sector recovery.

Data released by the Census Bureau today

Our first table (link to pdf) presents the Census Bureau’s single year poverty estimates for the United States and New York State for 1980 through 2011. The 2011 data is new, and the 2010 data is revised from last year’s release.

  • Historical context for the national poverty rate – The data released today by the Census Bureau indicates that the U.S. poverty rate declined slightly (from 15.1% to 15%) from 2010 to 2011 with slightly fewer people estimated to be living in poverty (down from 46.343 million to 46.247 million). In 2010 and 2011, for the first time since 1993, the national poverty rate was estimated to be 15% or higher.
  • Historical context for the state poverty rate – The estimated poverty rate for New York State remained at 16.0% for 2011, the same as it was for 2010. These two years were the first years that the state poverty rate was above 16% since the mid and late 1990s. The number of New Yorkers estimated to have lived in poverty in 2011 (3.085 million) was slightly higher than in 2010 (3.062 million), but not by a statistically significant amount.

A second table (link to pdf) presents the Census Bureau’s estimates of two- and three-year average poverty rates for the 50 states. Because of the CPS’s small sample size for small states, the Census Bureau recommends using these multi-year averages (rather than single year estimates) for comparing the states to each other, and for making comparisons over time.

  • New York compared to other states – Using the 2-year average poverty rate for 2010 and 2011 to make interstate comparisons, New York had the 15th highest percentage of people living in poverty – that is, tied with Nevada, and higher than every other northern industrial state. New York’s 2010-2011 poverty rate was 16% while its tri-state area neighbors Connecticut and New Jersey were at 9.3% and 11.2% respectively.

Next week, the Census Bureau will be releasing 2011 estimates from another survey, the American Community Survey (ACS). The ACS has a larger sample size and presents estimates of sub-state jurisdictions with populations of 65,000 or more.

Employment Patterns in NYC’s Low-Income Neighborhoods

September 12, 2012. James Parrott presented an overview of income and earnings to the New York City Workforce Funders, a group that meets quarterly to share information about workforce issues and enhance the effectiveness of New York City’s workforce development programs.

Christie Talks of a Comeback, but Jobs Data May Say Otherwise

September 10, 2012. New York Times columnist Michael Powell cites FPI’s James Parrott in a piece about Chris Christie. Excerpt:

New York City officials complain a lot of late that the city’s 10 percent unemployment rate overstates its problems. Several experts believe they have a point — the Fiscal Policy Institute issued a report last week noting that the city’s real unemployment rate is most likely closer to 9 percent than to the official 10 percent. (A 9 percent rate is still higher than that of the nation as a whole. And the Bronx, with about a 13 percent rate, is the hardest hit county in the state).

I asked James Parrott, chief economist for the Fiscal Policy Institute, if the same could be said of New Jersey. Is the Garden State perhaps in better shape than it looks?

Not really, he says.

Link to the article.

Bob Cohen, James Parrott

September 6, 2012. Bob Cohen, the Policy Director of Citizen Action of New York and the Public Policy and Education Fund, joined the show. Citizen Action of NY is coordinating the New York activities of a new national campaign, Americans for Tax Fairness, to bring greater fairness to the federal tax code by ending the Bush tax cuts for the richest 2 percent of Americans.

James Parrott, the Fiscal Policy Institute’s Deputy Director and Chief Economist, discussed the new edition of the State of Working New York .

Study: Colorado Immigrant Owned Businesses Generate $684 Million In Earnings

September 6, 2012. A post on the DailyMarkets.com blog. Excerpt:

Colorado’s immigrant-owned businesses generate a whopping $684 million a year in revenue, according to research conducted by the American Community Survey. There are over 13,000 immigrant-owned small businesses in Colorado according to a recent study conducted by the Fiscal Policy Institute, a research organization in New York.

The report, Immigrant Small Business Owners: A Significant and Growing Part of the Economy, details the number and characteristics of immigrant small business owners across the country and Colorado’s number of immigrant owned businesses, specifically, is an ‘unexpected finding’ said Kathy White, deputy project director at the Colorado Fiscal Policy Institute. Another interesting finding, the report says, is that Denver Metro immigrants are 10 percent more likely to own a small business than their U.S.-born counterparts.

The study used data from the U.S. Census Bureau’s American Community Survey. The $684 million in earnings from immigrant-owned businesses is based on revenues from 2006 to 2010, the publication reports. More >

New York is creating jobs faster than the rest of the country, but not fast enough

September 5, 2012. New positions haven’t brought down the unemployment rate and pay less than the old ones. Low-wage jobs, such as those in fast-food restaurants, have grown in the city even as middle- and upper-income positions have vanished. An editorial from the Daily News.

New York City gained jobs at a faster rate than the nation as a whole since the end of the Great Recession and has more salary-paying positions today than it did back then. That’s the good news.

The bad news is that job growth has not been nearly fast enough to drive down an astronomical unemployment rate.

The worse news is that the city has been shedding middle- and upper-income jobs while adding far more low-wage positions, such as work in restaurants and the home health care industry.

These are some of the key findings of the Fiscal Policy Institute’s annual “State of Working New York” report, a document that raises alarms about the future of the city’s labor force and economy.

The boom years that preceded the bust made it easy to overlook worrisome trends. Even in those good times, job growth was concentrated at the low end of the scale so that losses on Wall Street were offset by, say, gains in retail employment.

When the downturn hit, the phenomenon of the high end giving way to the low end kept up. Since 2008, the institute reports, the city lost 60,000 jobs that paid more than $45,000 while adding 130,000 positions that paid less than $45,000.

That computes to a gain of 70,000 jobs. The number means that more people are getting paychecks, so we’ll grab it even while knowing that the wage scales are below levels necessary to maintain a vital middle class.

The movement toward lower-paying work helps explain the City Council’s focus on measures to establish so-called living or prevailing wages and to require benefits like paid sick leave.

What the Council fails to understand – and should now come to see – is that it lacks the legislative power to reverse sweeping economic forces by fiat. The members should instead appreciate the city’s job gains while encouraging a stronger middle class through projects like the expansion of New York University and the opening of the Cornell-Technion high-tech graduate school.

Union Jobs Plummet in the Private Sector

September 4, 2012. Patrick McGeehan mentioned this year’s edition of  The State of Working New York in a New York Times story.

The study coincided with a report from the Fiscal Policy Institute that found that most of the jobs that have been created in the city during the economic recovery have been in industries that tend to pay low wages, including restaurants, retail and home health care.

James Parrott, chief economist for the institute, which is supported by labor unions, noted that the deep slump in construction in the city has taken a toll on unions. According to his report, “The State of Working New York 2012,” the number of construction jobs in the city has declined by 23,000 in the past four years.

Study: State slow to get jobs back, Growth held to low-paying areas

September 2, 2012. An article by Sara Foss, Schenectady Daily Gazette.

A new report paints a dismal portrait of the economic recovery, noting that unemployment has been high for years and the state’s modest job growth is concentrated among low-wage industries.

Despite this, New York has actually fared better than other states, according to the Latham-based Fiscal Policy Institute’s annual “State of Working New York” report, released today.

James Parrott, the institute’s deputy director and chief economist, said that over the past four years, only five states have done better than New York in terms of net job growth: North Dakota, Texas, Arkansas, Oklahoma and Louisiana. Even so, no state had a higher increase in unemployment over the past two years than New York. Since July 2008, the state has experienced the net loss of 144,000 middle-wage jobs and 29,000 high-wage jobs, and a net gain of 194,000 jobs in low-wage industries.

One problem area has been the state’s manufacturing sector, which has only grown by 0.5 percent over that period of time, compared to 3.8 percent nationally and 4 percent in Midwestern industrial states. Much of New York state’s growth has been in restaurants and retail, Parrott noted.

Unemployment in New York has hovered around 8 percent or higher for the past 3 1⁄2 years, the longest stretch since the 1970s, while the average stretch of unemployment is eight months. Nationally, job growth has been about one-third of what it has been in prior recoveries.

“Prolonged high unemployment is economically and socially very detrimental,” Parrott said. “We shouldn’t tolerate it and can do something about it with the right federal and state policies. It is certainly not inevitable.”

Unemployment has remained high because the state’s job growth has been accompanied by growth in its workforce – about 100,000 new workers, over the past four years, according to the institute.

The state Labor Department’s July report on unemployment rates throughout the state found the percentage of job seekers re-entering the labor force or entering the labor force for the first time increased 9.8 percent from July 2011 to July 2012, compared to a 0.4 percent increase throughout the country. In July, the state’s unemployment rate was 9.1 percent, according to state labor officials.

In the Capital Region, unemployment has increased over the past year, from 7.2 percent in July 2011 to 8 percent this July.

New workers

“Our population has grown,” said James Ross, a labor market analyst with the state Labor Department. “We don’t need to get back to the number of jobs we were at five years ago – we need more.”

He suggested that many people cannot afford to retire, so baby boomers are not exiting the workforce as quickly as they might have prior to the recession. Some retirees have even re-entered the work force as a result of sharp declines in their investments.

Ross said local job growth is concentrated in professional and business services, a category that includes scientific and technical jobs, as well as manufacturing, education and health services. Areas that have suffered include retail and information services, a category that includes the media. The public sector has also suffered big losses, as states, counties and municipalities struggle to balance budgets during a time of diminished revenue.

The institute report suggests the state’s unemployment rate is overstated by about a percentage point.

The weakness of the recovery can be partially explained by the severity of the recession, and also by slack consumer spending as a result of high household debt and unemployment and a slowdown in government spending.

“During the first three years of previous recoveries, state and local spending grew at an average annual rate of 3 percent; during the first three years of the current recovery, state and local spending declined on average by 2.3 percent per year,” the report notes.

Parrott said he doesn’t think the weak recovery will worsen, but he doesn’t see it getting dramatically better any time soon, either.

“On the one hand, the housing market is becoming less of a drag,” he said in an email. “On the other, Europe’s recession is hurting the U.S. and global growth. However, if federal spending is sharply cut, that will bring our very slow growth to barely a crawl, maybe worse.”

Party’s over

Ross said the country was living on debt during the boom years and is now adjusting to a new normal where credit is more restricted and the country’s long-term growth is slower.

“Financial institutions were creating wealth out of nothing,” Ross said. “Our wealth was going up for no reason whatsoever. … We are not going to recover to the same level we were at before, when we were essentially overspending.”

Kajal Lahiri, a professor of economics at the University at Albany, said economic recoveries have been weakening for some time.

“After the recession ended in 1990, employment didn’t pick up as fast,” he said. “Now that is sort of built into the system.”

He said the post-recession economy is more “service-oriented,” with more of an emphasis on technical jobs that require educated employees. As a result, unskilled workers have suffered. What’s needed, he said, is more education and training to give people the skills they need for this new economy.

Parrott said he believes the main problem is a lack of demand, not a lack of skills.

“Everything we know from how the economy operates is that if there is strong demand, employers will hire and train workers,” he said.

Report: New York Adds Low-Paying Jobs During ‘Tepid’ Recovery

September 2, 2012. A story reported by Daniel P. Tucker for WNYC.

Workers in restaurants, education and home health care making less than $45,000 a year are the face of New York State’s “disappointingly weak” economic recovery, according to a new report from the non-partisan Fiscal Policy Institute.

The state now has 21,000 more jobs than it had before the recession, but the math tells a story of declining wealth. New York lost 144,000 middle-class jobs that paid between $45,000 and $75,000 a year, as well as 29,000 high-wage positions. The net gain comes from 194,000 new low-paying jobs.

“Job growth in the city and state has been concentrated in industries like restaurants and retail trade where the average wage is much below the average in sectors like government, manufacturing and construction where a lot of the jobs have been lost,” FPI chief economist James Parrott said in an interview.

Meanwhile, New York City has seen strong growth in tourism, another low-paying industry on the whole, Parrott said. The city has had a net gain of 70,000 jobs since the start of the recession, but only because it added 130,000 low-paying jobs.

The growth of the low-wage sector, which is part of a national trend, is no cause for celebration, according to the report.

“This national recovery is historically weak,” Parrott said. “It’s the slowest recovery from a recession since the 1930s.”

Unemployment Hampers City and State

During the first year and a half of the recovery, from December 2009 to July 2011, New York City and state outperformed the national average in job growth.

But as U.S. unemployment has fallen in the last 12 months, the rate in New York has jumped from 8.2 to 9.1 percent, a hard-to-explain phenomenon, according to the report’s authors, since the state added 114,500 jobs during the period. At the same time, New York City saw unemployment rise a full percentage point to 10 percent despite adding 59,000 jobs.

While several factors could help account for why this moderate job growth has not reduced unemployment, the report concludes that New York state’s unemployment rate may be overstated by as much as a percentage point.

“Even if you have an unemployment rate in the state of 8 percent and in the city of 8.5 or 9 percent, that would be considered recession standard unemployment rates,” Parrott said.

Prior to the recession, unemployment was around 5 percent in the state. It’s a rate the Federal Reserve estimates will take years to achieve again.

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