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Risk Management Association Long Island Economic Update What Lies Ahead? Dr. Martin R. Cantor, CPA Long Island Center fo

Risk Management Association Long Island Economic Update What Lies Ahead? Dr. Martin R. Cantor, CPA Long Island Center for Socio-Economic Policy www.martincantor.com February 7, 2014. Long Island’s Future Workforce Is Leaving The Region The Millenials - Long Island Births 1980-1999

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Risk Management Association Long Island Economic Update What Lies Ahead? Dr. Martin R. Cantor, CPA Long Island Center fo

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  1. Risk Management Association • Long Island Economic Update • What Lies Ahead? • Dr. Martin R. Cantor, CPA • Long Island Center for Socio-Economic Policy • www.martincantor.com • February 7, 2014

  2. Long Island’s Future Workforce Is Leaving The Region The Millenials -LongIslandBirths 1980-1999 Long Island’s Young People - 2000-2012 Long Island Long IslandBirths% Household DecadeBirthsPopulationPopulationSize 1980-1989: 331,700 2,609,212 12.7 % 2.99 1990-1999: 381,082 2,753,913 13.8 % 2.95 ========================================================= Ages 20-35 2000 498,126 2,753,913 18.1 % 3.02 2012 476,626 2,831,072 16.9 % 3.04 =========================================================

  3. 17 ALL LONG ISLAND JOBS ARE NOT CREATED EQUAL SHIFT FROM HIGH PAYING TO LOW PAYING JOBS • , 17,211 Manufacturing Jobs Lost • Dropped from 8.1% to 6.4% • 1900 jobs lost in 2013 • 9,284 Construction Jobs Gained • Increase Sandy Related • Increased from 6.4% to 6.7% • 18,933 Finance, Insurance & Real • Estate Information Tech Jobs Lost • Dropped from 13.7% to 11.6% • Lower Paying Service Sectors • 65.7% 2000 Workforce -69.7% 2012 • (ALL DATA FROM US Census 2000-2012) SUMMARY 2000-2012 HIGHER PAYING LOWER PAYING JOBS LOST: JOBS GAINED: 36,144 99,579 Total Jobs Gained 67,362 (5.1%)

  4. Long Island’s Declining Economic Strength The Results of Workforce Shift • From 2000-2012 (Real Dollars Adjusted for Inflation) • $1.5 BILLION LOSS in Buying Power (2000-2012) • $1,250 PER PERSON REDUCTION in Spending • 2.8% Loss of GRP During Great Recession (2005-2010) • $500 MILLION LOSS in GRP (2008-2011)

  5. Long Island’s Eroding Labor Force Between 2000 and 2012 Fewer Long Islanders Over 16 Years of Age Working Percent of the labor force not employed increased 181.6% from 2000 - from 3.8% to 6.9% Percent of over 16 population in labor force increased by 2.6% (64.2% in 2000 unchanged since 2010-65.9%) Percent of over 16 population employed decreased by .8% from 2000. (61.3% in 2012)

  6. Unrest in Long Island’s Manufacturing Sector LONG ISLAND FORUM FOR TECHNOLOGY STUDY: 34% MANUFACTURING FIRMS LIKELY TO LEAVE (1,200 Companies) 56% Agreed that the manufacturing sector would contract over the next five years Resulting in: 25,000 ADDITIONAL HIGH PAYING JOBS LOST and $1.25 BILLION in ANNUAL WAGES LOST Just this alone over 30 years = $37.4 BILLION LOST

  7. 2012 Long Island Family Income • (stated in 2000 dollars) • Median 2012 Family Income: • Nassau County $80,208-Decreased 1.3% from 2000 • Suffolk County $71,222- Decreased .5% from 2000 • Per 2012 Capita Income: • Nassau County $30,274-Decreased 5.8% from 2000 • Suffolk County $26,360-Decreased .82% from 2000

  8. Long Island Family Income Distribution – 2012 The Wealthier Got Wealthier Family Income % LI Increase Family Income Bracket Families (Decrease) 2012 from 2000 Below$10,000-$24,999 6.3% (30.4%)(9.1% - 2000) $25,000-$49,999 12.3% (32.0%)(18.1 - 2000) $50,000-$99,999 28.1% (28.7%)(39.6% - 2000) $100,000-$199,999 38.0% 43.9% (26.5% - 2000) Over $200,000 15.3% 130.1% (6.7% - 2000)

  9. Long Island is Aging • Between 2000 and 2012 • Long Islands Population Increased by 2.8% • While • Over 60 Year Olds Increased by 90,000(+18.7%) • 20 to 60 Year Olds Increased by 9,350 (+.62%) • Under 20 Year Olds Decreased 22,000 (-2.9%) • LONG ISLANDS GROWTH DEPENDS ONTHE RETENTION AND ATTRACTION OF THE • YOUNG WORKFORCE

  10. Long Island’s Economy: Where Do We Go From Here -Hurricane Sandy- Nearly $2 billion in short term spending -multiplier of $1 billion = $3 billion economic activity. -LI housing prices have bottomed out-dropping 56 % between 2005 and 2012: Sales prices increased by 1% since 2010. -LI home sales fell - 49,000 homes selling for $30.3 billion in 2005 to 23,287 homes selling for $13.6 billion in 2012: 22,642 homes sold in 2013 for $8.1 billion -LI foreclosure notices increased from 6,249 in 2005 to 13.132 in 2012. Have leveled off in 2013. -LI Rental housing decreased by 7.8% since 2010 to 18.4% of LI housing. -New York City/Long Island Gross Regional Product 2011 increase of .08% (to $1.28 trillion) lags behind national 1.66% increase

  11. Long Island’s Economy: Where Do We Go From Here CONCLUSION -Long Island Economy slowly recapturing the 3.3% Gross Regional Product lost during Great Recession. -The process will be slow-LI is now a low multiplier service sector economy spin off lower paying secondary jobs. -Higher paying manufacturing jobs (6.4% of 2012 workforce 8.07 in 2000) will leave region for less expensive places, causing loss in the secondary jobs that they create. -Fewer Long Islanders in workforce with fewer working. -Lower family and Per Capita income in high cost region. -Housing prices will take time to rebound-prospective purchasers are earning less income and young people are leaving the region. More homes sold for less $. Hurricane

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