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Economist: New NY Unemployment Numbers Argue “Against” State Job Cuts

January 21, 2011

NEW YORK - A local economist says the latest unemployment numbers show New York is performing about as well as the rest of the nation, with the state's jobless rate staying steady at 8.2 percent. Gov. Andrew Cuomo has proposed cutting up to 15,000 state workers as a way to trim the state's budget deficit, but economist James Parrott, deputy director of the Fiscal Policy Institute, says that's the wrong way to go, especially considering the latest unemployment numbers.

"With nearly 800,000 New Yorkers still out of work, it's doubly important that the governor and legislature balance the budget in a way that doesn't add to the ranks of the unemployed."

Parrott says New York's unemployment rate would have risen in the second half of the year if discouraged job-seekers hadn't stopped looking for work and dropped out of the labor force.

Rather than add thousands of state workers to the unemployment rolls, Parrott says the state could simply extend a tax surcharge that has been on the books since 2009 to help balance the bottom line.

"We can go a long way toward closing future budget gaps if we keep that personal income tax surcharge in place."

Those who believe the tax rate is too high say New Yorkers will get some relief if the surcharge is allowed to expire at the end of 2011.

While the state's unemployment rate is flat, the latest census numbers show New York's population growth is slow, compared to western and southern states. Some business groups blame the situation on high taxes, but Parrott disagrees, especially when other research shows the state ranks number one in worker productivity.

"Our tax burden, whatever it is, is helping pay for infrastructure and education and other human investments that give us a very highly urbanized, highly productive economy."

More census data is available at

Mike Clifford, Public News Service - NY