New York City is losing jobs, making life difficult for Mayor Zohran Mamdani as he seeks to close a massive budget deficit while emphasizing economic justice over growth.
The city lost 20,000 jobs by 2025 to end the year with 4.823 million employees, according to updated employment figures released Thursday by the state labor department. City economists, along with state and city officials, had expected an increase of about 40,000.
The biggest change came in health care jobs, which was the only area of expansion, with the number of home health workers improving by 46,000.
The bad news comes as the city faces a series of new economic challenges:
- Unemployment among college graduates in their 20s has been rising sharply over the past year.
- The once thriving film and television production industry is in dire straits.
- And Wall Street, whose rising profits and bonuses have boosted tax collections, is reeling from the war in Iran.
Some economists blame President Donald Trump.
“It’s no surprise that Trump’s policy has been damaging the economy, including in New York City. Tariffs, policy volatility and uncertainty, cuts to the social safety net, and the expansion of many deadly wars around the world are not good policy anywhere, including here,” said Emily Eisner, economist and acting director of Fis Policy.
Monthly employment data comes from an employer survey conducted by the federal Bureau of Labor Statistics. Each year the state labor department updates the numbers using data from unemployment insurance taxes paid by employers, which is more accurate but not timely. This year’s transition was delayed several weeks by the federal government shutdown. (The numbers in this story are based on a December 2025 to December 2024 comparison).
The new numbers on home health care jobs, which are almost entirely covered by the federal Medicaid program, may be the most important development, as they accounted for nearly two-thirds of all new jobs in the past two years. The Hochul administration’s efforts to reduce its rising costs appear to be working, which is good for the state budget — but bad for the city’s economy.
For the first time, the unemployment rate among young college students between the ages of 22 and 27 has risen to 6.5%, about the same as New Yorkers between the ages of 22 and 27 without a degree, according to a report issued last month by the city manager.
The change is amazing. At the end of 2020, amid this epidemic, more than 25% of young New Yorkers without a degree were unemployed, while only 10% of those with a bachelor’s or advanced degree were looking for work.
Job vacancies have fallen by a third since 2019, according to the latest report from the Institute for the Urban Future. Even internships are more difficult, down 37%, it found.
In a so-called underemployed, low-income environment, there are few opportunities for those just entering the workforce, says Janelle Jones, senior economist at the progressive organization Groundwork Collaborative.
Whether companies are not hiring because they expect artificial intelligence to replace workers is difficult to understand, he adds, a view consistent with the director’s report.
“The rate of youth unemployment in New York, especially college graduates, is an alarming trend,” said City Manager Mark Levine. “Whether it’s the high cost of living or the impact of AI, everyone in government needs to focus on how we help young people enter the workforce.”
It’s hard to produce movies and TV
At the same time, the city’s once-thriving film and television production business has contracted by nearly 20% despite annual federal tax credits of $800 million, amid consolidation and a drastic reduction in the number of programs and films produced.
New York is not the only one suffering. The reduction of work in Los Angeles is 30% while the number of films and television programs with budgets of more than $40 million produced in the United States has dropped from 251 in 2021 to 159 last year.
More bad news is coming from around New York. It was reported last week that Deutsche Bank filed a lawsuit against Hackman Capital, the owner of Kaufman Astoria Studios, for failing to pay the debt in a clear sign of financial distress. Hackman also owns Silvercup Studios, another major soundstage in Long Island City.
Despite the revival of the industry, the Adams Economic Development Corp. continued to support the expansion of the studio space, and another stage at Pier 94 opened in January.
The ruins of Wall Street
What happens on Wall Street will be important to the economy of the city, especially the budgets received by the state and the city this time of year.
Record profits and bonuses last year have boosted tax collections for the state and city and job reforms have boosted employment to record levels. Both the governor and the mayor are taking advantage of this opportunity by increasing their revenue expectations for the next budget.
But the stock market is down 6% for the year, and if the war with Iran continues, it could jeopardize plans for the largest public stock offerings in history this year from AI and SpaceX companies. IPOs generate huge profits for Wall Street firms.
Mamdani’s focus: Economic justice
Meanwhile, the Mamdani administration is yet to outline an economic plan. For the first time in anyone’s memory, the city does not have a deputy mayor for economic development. Instead, Julie Su is the deputy mayor for economic justice. It has not named a new head of the Economic Development Corporation, historically the agency responsible for finding ways to grow the economy.
Mamdani’s administration did not respond to a request for comment.
New jobs data will be front and center as Albany and City Hall adopt their next budget and decide between cutting federal aid and increasing taxes, with the governor opposing tax increases and the mayor pushing for the expansion of the rich and big corporations.
Progressives say it’s important to find ways to mitigate the impact of federal aid cuts. This week, 450,000 New Yorkers were notified that they will lose their health coverage in July due to changes in one of the state’s most important health care options.
“We now have clear evidence that the actions of the Trump administration have had a devastating and negative impact on people’s ability to find work and earn a living to support their families in the United States and New York City is not immune to this,” said Lauren Melodia, who follows the city’s economy at the New School Center in New York City.
“This is especially a problem that requires government action, and New York’s policymakers, firms and workers are very much in a bind as job cuts in the city lead to greater poverty and the need for a social safety net that the federal government is literally destroying.”
But those opposed to the tax increase say the new data is no reason not to change course.
“The job losses confirm what we’ve been saying: that the economy is weak and the risks are increasing in a serious way, from AI disruption to tariffs and now increasing tax uncertainty from City Hall and Albany,” said Steven Fulop, CEO of the major business group, Partnership for New York City.
“The city and the state can’t control AI or fees, but they can control taxes and raising taxes now would cost more jobs and exacerbate the affordability problem,” he said.
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