Latest Job Losses Could Crater N.Y., Conn. Budgets
The devastating April U.S. job numbers are an early insight into the impact COVID-19 will have on state budgets, including in New York and Connecticut.
On Long Island, more than 260,000 residents have filed unemployment claims since mid-March. One in five workers in Nassau and Suffolk Counties is out of a job.
“Long Island’s a very important economic engine for New York State. And if we don’t get back online, the state’s going to have big problems as well,” says Dr. Martin Cantor, who heads the Long Island Center for Socioeconomic Policy.
Cantor says that’s because Long Island generates 20% of the state’s economy. He says workers from almost every industry have been affected, from restaurants and retail to finance and law. He says local government workers could also see layoffs soon, if the federal government doesn’t step in with more coronavirus help.
Hofstra University economist Greg DeFreitas says the unemployment numbers mean a huge reduction in state revenues and an increase in expenses.
“The number of people, because of job loss, losing their health insurance is going to be by over 12 and a half million. So with that happening more people are going to fall into poverty, which means more people are going to need Medicaid and other parts of the safety net including food stamps.”
UConn economist Fred Carstensen agrees that more federal assistance is needed.
“If we don’t address the issue of state and local governments – their aggregate deficit is about half a trillion dollars – that’s true in Connecticut. In Connecticut they are projecting a $7 billion shortfall in terms of tax revenue.”
Congressional delegations from both New York and Connecticut are pushing for emergency federal stimulus funding to help state and local governments.
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