New York’s Retail Sector Still Struggling

While New York’s overall economy has recovered almost all jobs lost during the pandemic — private sector employment is now down by just 0.8 percent down from its pre-pandemic total — the city’s retail sector still has 11.1 percent fewer jobs than it did in February 2020, a new study from The Center for an Urban Future (CUF) has found.

“A combination of factors is likely contributing to the retail sector’s stalled employment recovery, including the rapid growth of online shopping, the increasing adoption of automation by retailers, the slow return of office workers, and the sharp drop in the city’s population,” the report states.

In addition to being one of New York’s largest industry sectors, retail also accounts for an outsized share of the most accessible jobs. “But the retail sector is lagging well behind the city’s overall jobs recovery and other face-to-face industries, including restaurants, that were hit hard during the pandemic, raising concerns about whether this vital and diverse part of the city’s economy will ever get back to its pre-pandemic employment level,” the report states.

In fact, retail jobs in the city have been declining since 2015, suggesting that the sector’s troubles run deeper than the pandemic. In fact, while employment in the city’s retail sector declined by 37,800 between February 2020 and February 2023 (an 11.1 percent decline), it is down by 45,700 since February 2015—a 13.2 percent drop. During the same period (February 2015 to February 2023), total private sector employment in New York increased by 11.5 percent, a net gain of 419,300 jobs.

The city has largely made up for the retail sector’s extended job losses with new employment growth in tech, health care, finance, and a handful of other industries, but a permanent loss of roughly 40,000 retail jobs would disproportionately impact New Yorkers of color. The retail sector’s troubles have almost certainly contributed to the widening gap in unemployment among Black and white New Yorkers — 10.4 percent compared with 2.5 percent.

To address this employment crisis, the UCF says city and state policymakers should invest in workforce training and continuing education programs that can help retail workers transition into other industries.

The UCF describes itself as “an independent nonprofit public policy research think-tank that produces innovative analysis on economic development and workforce development issues in New York City, with a focus on promoting economic diversity while creating opportunities for disadvantaged populations and lower-skill workers. Our work seeks to highlight issues within our fields of focus that tend to fly under the radar in mainstream policy discussions.”

Click here for the full report.