1. Economic Update for Upstate New York Richard Deitz Regional Economist Federal Reserve Bank of New York, Buffalo Branch richard.deitz@ny.frb.org March 12, 2003

2. Upstate Job Growth: On Par with Weak US Performance Source: US Department of Labor Employment Index: 2000 = 100 US Upstate

3. Upstate Job Growth By Sector in 2002 Compared to the US; bubble size indicates relative size of industry in the region Source: US Dept of Labor Services Finance Upstate Growth Rate US Growth Rate Construction Utilities/Comm Trade Gov’t Manufacturing

4. -6,358-1.1% -10,525 -1.9% Total Change in Nonfarm Payroll Employment netpercent Job Growth in Upstate Metros: 2000-2002 -1,325-0.4% +5,500+1.2% -1,850-1.4% -2,533-2.1% Buffalo Syracuse Rochester Albany Utica Binghamton US -0.7%

5. Average Job Loss in Postwar Recessions Local area Peak through Trough Source: U.S. Department of Labor

6. Job Loss in This Recession Local area Peak through Local Trough Source: U.S. Department of Labor The least diverse economies suffering the biggest losses

7. Rochester & Binghamton: Least Diverse Industry Mix Industrial Diversity Index: 1997 Index Source: Bureau of the Census, County Business Patterns, author’s calculations

8. Job Growth: 1990s Expansion vs Recession rankings of the largest 100 metro areas Las Vegas 1 8 Austin2 61 Phoenix 3 69 Orlando 4 57 Atlanta 5 93 West Palm Beach6 15 Tampa 7 36 Dallas 8 72 Salt Lake City 9 85 Sarasota 10 16 Source: Bureau of Labor Statistics 1990-20013/01 - 12/02

9. Key Local Industries National employment declines Buffalo: rank #48 Autos - 7% Fabricated metal products - 8% Rochester: rank #77 Instruments- 7% Seattle: rank #98 Aircraft- 16% San Jose: rank #100 Communications equipment- 9% Electronic components - 25% Source: Bureau of Labor Statistics

10. Manufacturing current recession compared to the last recession

11. Manufacturing Job Losses Index US Loss: 1990 Note: 1990 recession is defined as employment peak to employment trough; current recession defined as 3/01-12/02 Source: U.S. Department of Labor

12. Manufacturing Job Losses Index Source: U.S. Department of Labor US Loss: 1990 US Loss: Current Note: 1990 recession is defined as employment peak to employment trough; current recession defined as 3/01-12/02

13. Upstate Losing its Share of Manufacturing Jobs Source: US Department of Labor Percent of U.S. Manufacturing Employment 15% Drop

14. Percent of Employment in Manufacturing Index Source: Bureau of the Census, County Business Patterns, author’s calculations US Average: 1990

15. Percent of Employment in Manufacturing Index Source: US Department of Labor US Average: current

16. Net Manufacturing Employment Impact weighted contribution to recessionary job loss Net Job Loss Attributable to Manufacturing Source: US Department of Labor Note: 1990 recession is defined as employment peak to employment trough; current recession defined as 3/01-12/02

17. Source: US Department of Labor Note: 1990 recession is defined as employment peak to employment trough; current recession defined as 3/01-12/02 Net Manufacturing Employment Impact weighted contribution to recessionary job loss Net Job Loss Attributable to Manufacturing

18. Long Term Sluggishness

19. Long-Term Job Growth is Sluggish Source: US Department of Labor Employment Index: 1991 = 100 US Upstate

20. The Labor Force is Shrinking Source: US Department of Labor Index: 1990 = 100 US Upstate

21. As is the Population population growth 1990 to 2000 Rochester Albany Syracuse Buffalo Binghamton Utica Source: Bureau of the Census

22. Average Wage Growth per Worker: 1997-2001 private sector, in core MSA county Source: ES202 US Average

23. Conclusions This recession has not been particularly severe for the majority of upstate except for Rochester and Binghamton The manufacturing impact has been somewhat worse than the last recession and upstate is losing its share of manufacturing jobs Long term stagnation and low wage growth are more concerning