LI's economy grew by 47,800 jobs, but remains below pre-COVID levels

The Long Island economy had 47,800 more jobs in March than it did a year earlier, with leisure and hospitality only 700 jobs below pre-pandemic levels, according to new state data.

The Island’s hospitality sector saw the strongest growth of any category in the region, adding 18,700 jobs last month measured against a year ago, the state Labor Department reported Thursday. The overwhelming majority of new jobs came specifically from bars and restaurants, some of the hardest hit businesses during the height of the pandemic.

The Island overall was down 46,400 jobs, or 3.5%, last month from the same month in 2019, a sign that the economy still has ground to cover in regaining lost jobs.

“The leisure and hospitality sector has really made a lot of headway regaining the jobs lost during the pandemic,” said Shital Patel, labor market analyst in the Labor Department’s Hicksville office.

While leisure has seen strong gains, Patel said it’s unclear whether arts, entertainment and recreation businesses — which typically see their biggest bump in employment leading up to the summer season — will show similarly sized gains.

“It’s a bit early to determine the health of the rest of leisure and hospitality sector," Patel said.

John Rizzo, an economist and professor at Stony Brook University, said while he thinks job gains in hospitality point to a good tourism season ahead, inflation will continue to challenge businesses unable to pass on all cost increases to customers.  

“Leisure and hospitality is a discretionary purchase by consumers," Rizzo said. "So the ability to pass on cost increases... is more limited.”

Rizzo explained that's because business owners can't raise prices too much without risking losing their customers. 

Additionally, Rizzo said business from international travel to the Island is likely to be curtailed amid global instability and continued concerns over COVID. 

In total, seven of the region’s nine private job sectors saw gains in March on a year-over-year basis, according to state figures.

On a month-over-month basis, the Island added fewer jobs in March, gaining 9,700 jobs when 12,300 is typical. Despite that, Patel said overall hiring the last two months has exceeded normal levels.

Patel said that increased hiring in February was likely due to the lowered level of Omicron infections in the region making business owners more confident in hiring additional staff. 

"The labor market picture remains positive if you look at the two months together," Patel said. 

In March and February combined, 14,900 jobs were added, well above the combined average gain of 10,300, she said. 

Professional and business services added 8,800 jobs, and trade and transportation added 6,600, coming in second and third place for the most jobs added.