(Bloomberg) --
New York City’s average unemployment rate may triple to 12% this year, higher than the Great Recession, as plunging tax revenue opens an $8.7 billion budget gap, according to city Comptroller Scott Stringer.
He predicted employment losses would spike by the end of June, with more than 900,000 losing their jobs -- one in five working New Yorkers. Restaurants, hotels and retail will be the hardest hit. Stringer’s forecast, outlined Tuesday in a report on Bill de Blasio’s budget proposal, is more dire than the mayor’s prediction last month that the city would lose more than half a million jobs over the first three quarters of the year.
The increase in the city’s jobless rate would be all the more jarring coming after a decade of steady, record growth. Before the new coronavirus struck, the city’s unemployment rate was 3.8%. New York City is the epicenter of the U.S. outbreak, with more than 171,000 cases, and has been under a state-ordered lockdown since March 22. Its reopening may be weeks away.
The city’s finances have been placed in further peril by the state’s fiscal crisis, which could cost the city more than $3 billion, Stringer said. He criticized de Blasio’s reliance on reserves and one-time savings, while calling on the mayor to cut more spending from the $89.3 billion budget he proposed in April.
Stringer also joined de Blasio’s call for more federal aid. New York contributes more to the U.S. budget than it gets back, and its taxpayer dollars are funding relief efforts across the country, according to the comptroller.
“We’re facing the deepest recession since the Great Depression, marked by historic and rapid job losses,” Stringer said in a statement. “In a crisis this severe, the federal government must step up and deliver relief to New York -- the economic engine for the nation.”
Stringer, elected comptroller in 2013, plans to run for mayor next year. Term limits prohibit de Blasio from seeking re-election.
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