“New York In the World” – New Report Documents Globalization’s Impact On New York State Economies

The SUNY Levin Institute and the Center for an Urban Future today issued the first comprehensive report on the impact of globalization on New York State, New York in the World. Based on more than a year of research and more than 150 interviews with people across the state, the report takes an in-depth look at the myriad of ways that globalization – the most important economic force of the last several decades – has impacted New York and each of the state’s major metro regions.

New York in the World is a research and public engagement initiative of the SUNY Levin Institute, which commissioned the Center to conduct the research and write the report. The study, which was funded by Carnegie Corporation of New York, is intended to serve as a fact-based resource to support a state-wide discussion on how to meet the challenges of globalization and generate economic growth and jobs based on opportunities in the global economy.

The report - available online - identifies major assets that the state has to support a competitive response to globalization in New York and builds on SUNY’s strategic plan as outlined in The Power of SUNY, which draws on the State University’s resources to serve as an economic engine and partner for the revitalization of New York’s economy.

SUNY Chancellor Nancy Zimpher said, “For our state to grow and prosper, it is essential that we identify ways for all regions in the state to tap into the global economy. With this report, New York business and community leaders, policy makers and the general public will be better informed to collaborate and take action to offer a competitive response to globalization and ensure a better future for New Yorkers.”

“There is no doubt that New York State has, in many respects, benefited from globalization,” said Garrick Utley, the President of the Levin Institute.  “And there is also no doubt that the costs for many New Yorkers and their communities have been tremendous, creating unprecedented economic disparities. The impact of the global economy has been so significant, so transformative, that in one generation the economy of the state has been fundamentally altered.”

Commenting on the Levin Institute’s initiative, Vartan Gregorian, President of Carnegie Corporation of New York, said, “In an era when economies recognize no borders and knowledge is the greatest international currency, public universities have a distinctive role to play in engaging scholars and policymakers with real-world issues. New York, with its great diversity of people and resources, already has a global outlook. The New York in the World project will provide the intellectual leadership, rigorous data and rich, informed discussion that will not only help today’s New Yorkers—and tomorrow’s—shape a successful future for the city and state but contribute to international progress, as well. It is the kind of engaged university of the 21st Century that we at the Corporation hope will grow and prosper.”

Jonathan Bowles, Executive Director of the Center for an Urban Future, who led the research effort, said, “Few places in the world have benefited more from globalization than New York City, thanks to its unmatched highly educated work force and globally competitive industries. Upstate cities have seen real benefits, too, but globalization has had a heavy toll in these areas in large part because traditional manufacturing accounted for an extraordinarily high share of all jobs before global competition heated up.”

New York in the World shows that between 1970 and 2000, a period that closely tracks the rise of the current global economy, New York State lost 50 percent of its manufacturing jobs—a larger decline than Pennsylvania, Ohio, Michigan, Massachusetts, New Jersey, and every other Northeastern and Midwestern state examined. Between 2000 and 2010, manufacturing jobs in New York declined by another 39 percent, greater than all of those other states except Michigan, which had a 47 percent drop. In addition, New York’s population growth between 1970 and 2010 (6.3 percent) was below every one of these competitor states. The report acknowledges that globalization was not the only factor in this massive economic dislocation—technological advances, productivity increases, cost differences between the states, and the rapid growth of the South and Sunbelt all played a role—but was a major contributor.

While this transformation has been swift and significant, the report finds that manufacturing remains a major component of some upstate economies, generating one-third of private industry wages in the Binghamton area, one-fourth in Rochester, and one-fifth in the Buffalo-Niagara Falls and Syracuse regions. Globalization has also helped sustain much of the manufacturing that remains in the state. As of 2006, nearly one-fifth (19.1 percent) of all manufacturing workers in the state depended on exports for their jobs, making New York State third in the nation in total manufactured exports.

At the same time, the report documents how much of New York City and its metro area have strongly benefited from the global economy. The city’s rich talent pool, its international connections, and cultural attractions, plus a meteoric increase in direct foreign investment in New York City have enabled the city’s financial institutions, law firms, architects, fashion designers and other sectors to prosper in the global market place. These successes, however, have been accompanied by a growing income inequality within the city.

Concurrent with the decline in manufacturing and the lack of good paying jobs, New York State saw a dramatic increase in immigration, predominantly in the New York City region.  Foreign born residents grew from 11.1 percent of the State’s population in 1970 to 21.7 percent in 2000.  In New York City today, 37 percent of the residents are foreign born.

On the whole, the report shows that the transformation to a global economy has not merely benefited downstate and hurt upstate. Instead, it concludes that growing numbers of upstate companies are taking advantage of globalization to export their products. Two upstate regions—Albany and Rochester—have fared much better in the new global landscape than other areas. And while globalization has largely benefited the downstate region, it has left New York City with a smaller share of decent-paying industrial jobs than every other American city and contributed to falling income levels, relative to the nation, in the boroughs outside of Manhattan.

 As New York in the World moves ahead, a prime focus will be on Public Engagement through media and forums held at the SUNY Levin Institute at the SUNY Global Center in New York City and across the state. During the month of November, forums are planned for Albany (November 4), Buffalo (November 16), Syracuse (TBD) and Rochester (TBD).  On December 14, the SUNY Levin Institute in New York City will host a Conference on New York’s Future in the Global Economy, with a focus on the role of higher education in regional economic development.