Eduardo Munoz | Reuters
General view of Gantry Plaza State Park, in Long Island City, New York, where Amazon.com selected to build part of its new second headquarters.
The job market in the Big Apple appears hotter than ever. With unemployment at record lows, the battle for talent is raging as tech giants, including Amazon and Google, lay plans to open new or expanded operations in Manhattan and Long Island City.
Projects include the new $5 billion Amazon headquarters in Long Island City, Google's new $1 billion 1.7-million-sq-ft campus in Hudson Square and a new office complex at Chelsea Market. According to a survey by Tech:NYC and Accenture, 80 percent of companies in New York City said they planned to hire more tech talent in 2018 than the year before.
The trend is spurring demand for tech talent as well as for other support services, such as advertising, fintech, accounting, compliance and more. Headhunters say that although direct impact has yet to be seen, the expansion plans bode well for New York City's job market.
"Even though New York is one of the most expensive markets in the country, it offers huge advantages for companies," said Jed Kolko, chief economist at online jobs site Indeed.com.
"It is the largest labor market in the country, and it's a fairly diversified market," he said, noting that New York City also offers a fairly broad mix of both employers and workers in many industries and occupations. For many companies, that makes it worthwhile to pay the high real estate and labor costs to be in New York.
The hiring spree will make an already tight job market even tighter. Last month the New York Department of Labor said seasonally adjusted unemployment fell to 3.9 percent in November. That's the lowest level since the department started keeping records in 1976. Not only that, but New York State's private-sector job count rose to an all-time high of 9.75 million.
Thousands of new jobs
In December Google announced a major expansion in New York that would add thousands of jobs and make it one of the city's largest commercial tenants.
Google's new campus, to be called Google Hudson Square, followed an announcement earlier in the year that the company would spend $2.4 billion to buy Manhattan Chelsea Market and lease additional space at Pier 57. The expansion project at Hudson Square is expected to be completed in 2020; the other should finish in 2022. Google, which has more than 7,000 employees in the city, expects that number to more than double over the next 10 years, the company said, though it's unclear the types of roles Google will be filling in New York.
Amazon, in a recent letter that was published in the New York Post and New York Daily News, said it expects to add 25,000 new jobs over the coming decade, including jobs in software engineering, product management, program management, operations, sales and marketing. Amazon also said it expects to contribute indirectly to tens of thousands of jobs in construction, building services, human resources, hospitality and retail.
Robert Bumsted | AP
New York City tech start-ups raised more than $25 billion from venture capital firms in 2018, according to Built in New York, citing data from Crunchbase. In the third quarter, New York-area companies raised more venture capital than San Francisco, according to a report by PricewaterhouseCoopers and CB Insights.
"I don't see the venture capital dollars drying up anytime soon unless 'the big R' happens," said Samet, referring to recession. If that happens, then even more talent would likely flock to larger companies. Meantime, he sees a lot of consolidation in ad tech and marketing tech, while fintech has been growing steadily.
Overall job growth was strong in 2018, both in New York and nationwide, and Kolko said he expects growth to slow somewhat in 2019, due in part to anticipated interest-rate hikes, which could slow growth.
The impact should be minimal to New York City, he said, because industries that are more sensitive to external forces, such as oil prices, exchange rates, or tariffs, tend to be industries that are not concentrated in New York, such as mining or manufacturing. Industries that are poised for continued growth, such as health care and services, tend to be concentrated in big cities, such as New York.