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New Yorkers Brace For Recession as Job Losses, Financial Industry Failures Hit Home


Thousands of New Yorkers have lost their jobs in the last seven months, as one large financial firm after another failed or was bought out. The city's tax base, retail and service industries all depend on those highly-paid jobs in the finance industry, which account for an estimated one-third of all wages earned in the city. City leaders have already announced they are planning nearly $2 billion in budget cuts, and New Yorkers expect continuing aftershocks from the financial meltdown.

On the surface, everything is the same. Taxis ply the streets of Manhattan, buses and subways run, and the lights of Times Square are bright. Downtown, tourists still photograph themselves next to the statue of a bull, a symbol of Wall Street prosperity. But New Yorkers from all walks of life say they're on edge.

“Everybody is very quiet, waiting. The feeling is of waiting, perhaps not quite understanding. I don’t think any of us understands yet just how bad it might get,” said Rosemary Scanlon, a professor of real estate and urban regional economist. She noted that every Wall Street job supported as many as three jobs in other industries. “And so the income multiplier of a downturn in jobs is enormous,” she said. “And it’s felt immediately in the restaurants, in the city, taxi drivers and limo drivers will feel the impact."

Waiting next to his car outside a Brooklyn office building, driver for hire Jose Abreu said he's already having a hard time finding customers. “It’s getting very bad, every day,” he said. “Always you go on the street, gas is very expensive, and there's no money on the street.” Abreu said he's worried about how he will pay his children's college tuition.

On the other side of the East River, Manhattan hedge fund manager Patrick D'Angelo agreed that the mood couldn’t be more anxious. “We're in trouble, and right now we need to avoid a depression,” he said. D’Angelo said that although recession is painful – and he believes one began eight months ago – economic activity doesn’t grind to a halt in a recession. “We could all muddle through, and I think there’s [still] the opportunity to make money,” he said. “A depressionm on the other hand, which is something we're faced with in a very real way, scares me. Because there's nothing any of us can do, and a depression tends to last a lot longer than a recession.”

Fitness trainer Isaiah Truyman’s clientele is mostly Wall Street bankers and traders. “A lot of them have been saying to me that this is the worst thing they've seen in their lives, and it's going to get a lot worse before it gets better, and the average person really has no idea of what is coming down the pike,” he said. Truyman’s planning to move to California this fall, in part because of the downturn. He has no confidence that his clients have any special understanding of what will happen next. “I get the feeling that they don't have a clue,” he said, “that they're just sort of playing it day by day. My sense is most people don't have a clue.”

Saudia Davis, a Jamaican who owns a cleaning business in Brooklyn, shares Truyman’s skepticism. She watches financial news obsessively, but said it did little to dispel her confusion. Her business is losing clients who can't afford to pay for housecleaning any more, she said, even as overqualified people are asking her for jobs. “We've actually even seen an increase in people that work on Wall Street that are now looking for any job, and they're willing to even clean as part of that,” she said, adding that if things worsen drastically, she said, she may even move back to Jamaica. “The ultimate goal is the American dream, and if it’s not achievable, there’s so many immigrants, that would probably be like, ‘Okay, I’m ready to go home now,’” she said.

Ramsey Shiber is one of the lucky finance industry professionals who still has a good job, one that pays enough to support his family on Manhattan's Upper East side. But he says everyone in his industry feels insecure, and still reeling from the wave of collapses. “Basically wondering every day when you go [to work], which other institution is going to fall apart, if another institution is going to fall apart,” he said. “So you have this kind of stunned period, at the same time, this disbelief, and at the same time, it's like what's next?”

Shiber said he and his wife, a filmmaker, have tried to come up with a fallback plan for another way of making their living, if need be. But they do not want to leave New York, where Shiber says a simple walk, among people from everywhere and iconic sights, is an instant cure for gloom. And despite budget cuts and harder times ahead, city leaders promise that keeping New York's streets beautiful and safe will remain a top priority. “I’ve seen the ups and downs,” Shiber said, predicting that the city will recover, and that New York will not lose its allure to tourists and investors. “Everybody wants to come to New York,” he said. “Everybody loves New York. New York isn’t going anywhere.”

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