William Dudley, president of the Federal Reserve Bank of New York, said employment in Nassau and Suffolk counties declined by about 4 percent in the 18-month downturn that ended in June 2009. "Since bottoming out in late 2009, employment here on the Island has rebounded by almost 2½ percent," he told local business executives. "So, we've come a bit more than halfway back to the early 2008 peak."
Speaking to the Long Island Association, Dudley noted employment growth has been undermined by layoffs by school districts and other local governments, a process that began later here than elsewhere in New York State. He noted hiring in business and professional services, finance, tourism and health care have helped to offset pink slips in the government sector.
Dudley also said local banks that were created right before or just after the 2008 financial crisis "are starting to show signs of growth," another indicator that the economy is rebounding.
Still, Dudley said the housing market remains "dreary." He said home prices "have yet to show any strong signs of bottoming out." They fell more than 20 percent in the recession from their peak.
Mortgage delinquency rates on Long Island "are much higher than in other parts of the state," Dudley warned. He added the New York Fed is working with housing counselors to help stressed homeowners.
In the long-run, the Island's economic future "is quite positive" because of the well-educated workforce, research laboratories and large number of high-technology manufacturers, he said.
In terms of the U.S. economy, Dudley cautioned against becoming overly optimistic in the wake of positive employment and retail sales numbers. "It is far too soon to conclude that we are out of the woods," he said.
Both 2010 and 2011 each began with positive economic news but growth slowed later in both years. He said the mild winter provided a temporary boost to construction activity and retail sales that may wither in the summer and fall.