The New York Newark-Jersey City metro area has an overall grade of B- with a composite score ranking it 44.6th percentile out of 50 US metros. This city's economic character is most defined by its below-average labor demand, with a composite score of 3.16 ranking it in the 22nd percentile, and its above-average wage growth of 6.12% year-over-year. The combination of these metrics suggests a complex economic environment with both challenges and opportunities.
Labor Demand
The employment growth rate in this metro area is -0.63% year-over-year, and weekly hours are deviating from the trend by +0.253%. This combination signals a contraction in labor demand, with hours above trend during job losses indicating a survivor squeeze where remaining workers are absorbing the load of eliminated roles. This suggests that businesses may face challenges in finding the right talent.
Unemployment
The unemployment rate in this metro area is 4.50%, ranking it in the 36th percentile. This indicates a market with some slack, but not excessively so. For a business trying to hire in this area, this means that there may be a moderate pool of available workers, but wages may not be under significant downward pressure.
Wage Growth
The year-over-year wage growth rate in this metro area is 6.12%, ranking it in the 78th percentile. This is a relatively fast rate of wage growth, suggesting that employer labor costs are rising. However, this also means that workers have increasing purchasing power, which can be beneficial for businesses that rely on local consumer demand.
Cost of Living
This city has a cost of living score ranking it in the 18th percentile, with a PSF of $540/sqft and average hourly earnings of $41.45/hr, resulting in a ratio of 13.03. This indicates that the city is relatively expensive compared to its peers. The fact that PSF is falling by -1.3% year-over-year is a positive sign, but overall, this city's high cost of living may make it challenging to attract talent without offering wage premiums.
Labor Force Growth
The civilian labor force in this metro area is growing at a rate of 0.73% year-over-year, ranking it in the 70th percentile. This indicates that the labor force supply is expanding, which is a positive sign for businesses looking to hire. This growth suggests that the city has a dynamic labor market with a growing pool of potential workers.
Building Permits
The number of residential building permits in this metro area is increasing by 64.22% year-over-year, ranking it in the 92nd percentile. This suggests that housing supply is expanding, which can help improve affordability and accommodate a growing workforce. This is a positive sign for businesses that rely on a stable and affordable housing market for their employees.
Days on Market
The current median days on market for homes in this area is 41 days, with a year-over-year decrease of -8.9%. This indicates a relatively fast-paced market, which can make it challenging for relocating workers to find housing. The low percentile rank of 10th percentile suggests that homes are selling quickly, making it a competitive market for buyers.
Office Economy
The share of jobs in professional and office sectors in this metro area ranks it in the 42nd percentile, with a composite score of 2.34. This suggests that the city has a moderately deep talent pool in these sectors, making it suitable for businesses in tech, finance, consulting, and HQ operations. However, it may not be as well-suited for industries that require a large workforce in industrial or logistics sectors.
The New York Newark-Jersey City metro area offers businesses a unique combination of above-average wage growth and expanding labor force supply, but also poses challenges due to its below-average labor demand and high cost of living. The single biggest risk or constraint for decision-makers is the potential difficulty in attracting and retaining talent due to the city's expensive housing market and relatively high cost of living, which may require wage premiums to remain competitive.