Upstate economy lags once again

ALBANY – In Plattsburgh on Tuesday, Gov. Andrew Cuomo proclaimed, "I'm proud to say my administration has made the largest investment in the history of upstate New York: $36 billion."

Cuomo recognized the challenges facing an economy once tied largely to manufacturing, and he said the state's investment is helping with the turnaround.

But two recent reports offered discouraging news about the region's improvements.

The Federal Reserve Bank of New York said upstate's recovery since the recession in 2009 has been slow. Separately, the Tax Foundation, a fiscally conservative group in Washington D.C., again ranked New York 49th in its business tax climate. Only New Jersey was worse.

Cuomo's office knocked the Tax Foundation as a partisan group, and it said the Federal Reserve review doesn't account for improvements in the state's unemployment rate and improved tax structure, saying the economy has followed national trends.

“National economic growth slowed in 2016, and New York is not immune," Morris Peters, a spokesman for the state Budget Division said.

"But under this administration, unemployment is down in every region of the state; median household income growth is outpacing the nation as a whole; taxes are down for every New Yorker, and upstate is benefiting from the largest economic development investment in history.”

The Federal Reserve report Oct. 13 painted a different picture, saying that while job losses north of the Hudson Valley weren't as severe as other parts of the country, the success since then has been slower than the nation's recovery: 0.6 percent growth compared to 1.6 percent nationally.

"Once the jobs recovery began in 2010, employment in upstate New York started to grow again, though at a pace well below the nation’s," the blog post states.

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The reports buoy a USA Today Network in New York investigation in June that showed despite heavy incentives to lure new businesses to upstate, the efforts have largely missed job goals.

Even though upstate regained all the jobs lost during the recession by mid-2015, the growth has flattened since then, the Federal Reserve said.

"Indeed, only a handful of jobs have been added to the area’s total employment count since early 2016," the post by Jaison Abel and Richard Deitz said.

The authors pointed to slow growth in western New York: Since early 2016, "job growth slowed to a crawl" in Buffalo, and Rochester lost jobs over the most recent stretch, fueled by the loss of 4,000 manufacturing jobs since 2010.

Buffalo had expansion because of the construction of the SolarCity factory and at the Buffalo Niagara Medical Campus, but as "these projects have wound down, so too has construction-related employment."

The report also noted declines had already been underway during the recession in Watertown and Elmira, and have continued since then.

Cuomo's record on improving the economy will be a key focus when he seeks a third term next year, and the Democratic governor is also considered a potential presidential candidate in 2020.

Critics often knock him over how the upstate economy is faring.

"Our leaders in Albany must step up, embrace and enact an aggressive agenda that reduces our tax burden, cuts regulatory red tape and promotes private sector job growth," Unshackle Upstate, a Rochester-based business group, said in a statement.

New jobs figures

On Thursday, the state Labor Department said New York's private sector job count fell by 36,500 between August and September. But between September 2016 and September 2017, the job count rose by 84,400, or 1.1 percent.

Over the past year, the Elmira, Buffalo and Rochester areas had drops in private jobs. Buffalo lost 3,900; Rochester lost 3,000; and Elmira fell by 500, the Labor Department said.

Still, the Labor Department said since Cuomo took office in 2011, the state has added 967,500 private-sector jobs and had employment growth in 68 of the past 81 months. In September, the unemployment rate increased from 4.8 percent to 4.9 percent; the national rate was 4.2 percent.

The Federal Reserve saw some optimistic signs in some parts of the state.

After struggling in recent years, the Utica and Binghamton areas have started to add jobs, while Ithaca remains one of the top performing upstate economies. Also, job growth in Syracuse and Albany have "remained fairly steady," the report said.

Cuomo said his administration is trying to turn around decades of manufacturing declines by cutting income taxes and business taxes and investing in the region.

"Where's tomorrow's enterprise? And that's a hard question," Cuomo said in Plattsburgh.

"And it's a question they're dealing with all across the country. Not just here. All the Midwestern states that were dedicated to manufacturing, and then it's gone. You need a plan. You need a backer. You need a place that is business friendly."