Gov. Andrew Cuomo has made it a priority to make New York a more business-friendly place, starting with his first State of the State address, when he announced his Regional Economic Development Councils and promised the creation of “jobs, jobs, jobs.” His administration’s top economic development official is Kenneth Adams, the commissioner of the state Department of Economic Development and the president and CEO of Empire State Development. Two other industries have been raised as potential drivers of economic development on the state level: hydrofracking and casinos. The governor is the driving force behind a potential legalization of casinos in upstate New York, and Joe Martens, Cuomo’s Department of Environmental Conservation commissioner, is overseeing the ongoing review of hydrofracking.
A hallmark of New York City Mayor Michael Bloomberg’s three terms in office was a more businesslike approach to governing, which built on his career as an entrepreneur and the founder of Bloomberg LP. His top economic development staffer is Seth Pinsky, who was appointed president of the New York City Economic Development Corporation in 2008. One of the city’s most high-profile projects is the development of a technology campus on Roosevelt Island.
New York is not business-friendly—at least according to the Tax Foundation, a pro-business think tank. In last fall’s State Business Tax Climate Index, New York came in dead last among all 50 states. Why? While New York State’s corporate taxes are moderate, it has the highest income tax and the sixth highest property taxes. Its income tax collections per person were $2,196 in 2010, higher than any other state. The Cuomo administration has been eager to shed the state’s reputation, launching the Regional Economic Development Councils in his first year in office and this year proposing his Tax-Free NY Initiative.
New York’s minimum wage is seen by many as inadequate to live on. In response, lawmakers passed legislation this year raising it from the current $7.25 an hour to $9 an hour, though that increase will be phased in over a three-year period. The wage will go up to $8 an hour at the end of 2013, to $8.75 at the end of 2014 and finally to $9 at the end of 2015. By doing so, New York will be joining 19 states, and Washington, D.C, in having a minimum wage that is greater than the federal rate of $7.25 an hour. The legislation also included a tax credit for employers who hire seasonal employees between the ages of 16 and 19 who are still in school. However, some lawmakers are pushing to remove that part of the legislation, which they say benefits large corporations and provides a disincentive to give raises or hire older workers.
Unemployment is on the decline, but New York State and New York City are still lagging behind the national average. National unemployment dropped from 8.1 percent to 7.5 percent between April of 2012 and April of 2013, while New York State’s unemployment rate dropped from 8.6 percent to 7.8 percent, and New York City’s declined from 9.4 percent to 8.4 percent. Why is the city’s unemployment rate nearly an entire percentage point higher than the national average? Some experts point to the Bronx. Although the borough’s unemployment dropped from 13.2 per-cent to 11.5 percent between March of 2012 and 2013, it is still home to many more unemployed citizens than the nation as a whole.
Mayor Michael Bloomberg has worked well with business in New York City, including the powerful real estate industry, while battling against organized labor, including a number of unions whose contracts have not been renewed in years. With insiders predicting that a Democrat is more likely to be taking the reins at City Hall next year, it’s an open question as to how friendly the next administration will be to business interests. The current front-runner, Council Speaker Christine Quinn, has positioned herself as a centrist, as has Bill Thompson, the 2009 Democratic nominee for mayor. On the Republican side, both Joe Lhota and John Catsimatidis have touted their business experience, the former as an investment banker and a company executive, and the latter as the founder of a successful grocery store chain.