LI lags state in 2010 economic growth

The economy grew at a slower rate on Long Island last year than it did in every other region of New York State save Binghamton, the state comptroller said Thursday.

The value of residents' income and all the goods and services produced here rose only 1.1 percent in 2010, a full percentage point below the statewide rate of 2.2 percent. In New York City and its northern suburbs the increase was 2.1 percent.

The Nassau-Suffolk performance was anemic compared with Ithaca, which grew 3.3 percent; the Hudson Valley, 3.1 percent and Buffalo, 2.9 percent.

Comptroller Thomas DiNapoli said the data showed that the state's recovery from the 18-month, 2007-09 recession, has been uneven.

"Our economic recovery is headed in the right direction, but the road out of the recession is still winding and potentially perilous," he said.

Long Island's gross metropolitan product shrank 4.5 percent in 2009, the most of any state region. New York City followed with a 4.4 percent drop.

Analysts in the comptroller's office and local economists said the Nassau/Suffolk region was dealt a heavy blow by the Wall Street meltdown. Many local residents were fired, while others lost income.

"The economic health of many communities on Long Island is heavily dependent on the strength of Wall Street," said DiNapoli aide Eric Sumberg.

Still, the gross product figures were in sharp contrast to those for unemployment, where Long Island performed better than most areas in 2009 and last year.

The jobless rate in Nassau and Suffolk was 7.4 percent last year, compared with 8.6 percent statewide and 9.5 percent in New York City. Eight of 13 regions were above 8 percent.

Pearl Kamer, chief economist for the Long Island Association business group, said there was a correlation between the sets of numbers. They show the loss of "high-wage, high-value-added" jobs in finance, real estate, information technology and professional services.

"The shift from higher-wage to lower-wage jobs is bad news for a high-cost area like Long Island," Kamer added.

Other experts were concerned about what happened to the gross product over the past three years.

On Long Island the figure shrank 3.1 percent from 2008 through last year, the most of any region. New York City contracted 2.8 percent.

Herman A. Berliner, an economist and Hofstra University provost said, "We are more vulnerable than a lot of us believed we were."

However, he and others were cautiously optimistic about this year, citing the bonuses paid to investment bankers and stockbrokers several months ago. Personal income statewide grew4.1 percent last year, to its highest level ever. Another increase is possible.

"We've seen higher than estimated tax collections [on personal income and purchases] year over year, and that bodes well," said Sumberg. "It is too soon to tell whether the increase in revenue will be sustained throughout the year."