Largely due to the inordinate clout of Big Labor’s forced union dues-funded political machine over New York’s elected officials, the Empire State’s employees, business owners, and other taxpayers have long been saddled with extraordinarily high taxes and excessive regulations.
But regardless of how bad the overall climate for job and income creation in New York State and New York City gets, state and local politicians count on Wall Street to generate sufficient tax revenue to stave off government insolvency. And despite a close call during the 1970’s, New York’s massive financial services industry has always obliged.
But now things may be changing. As a recent article in the Dallas Morning News reported (see the link below to read the whole thing), the Big Apple’s establishment is beginning to worry, to quote a 2015 report by a business coalition known as the Partnership for New York City, about a “growing trend” in financial services to “move job and business operations to lower cost, more business-friendly environments.”
And according to a Forbes magazine analysis, cited by the Morning News, nine of the 10 of the top-ranking cities for financial services job growth from 2008 to 2013 (Phoenix, Dallas, San Antonio, Nashville, Richmond, Austin, Tampa-St. Petersburg, Orlando, and Salt Lake City) are located in Right to Work states. The sole exception is St. Louis.
The success formula for such cities, according to economist and demographer Joel Kotkin and Pepperdine University professor Michael Shires, is “large-scale population growth, low taxes, affordable housing and business friendliness.” Major urban areas located in states with Right to Work protections commonly feature all of these advantages.
Even as the top-ranking cities added a total of more than 85,600 financial services jobs over a five-year period, New York City lost nearly 24,500 jobs in this sector.
The Morning News asked Sally Bane, executive director of the economic development department for Plano, Texas, whether she thinks the financial services employment growth in her region can be sustained. Bane explained why she’s not worried:
[Plano] has a high concentration of financial services jobs; . . . [I]t’s expected to be the city’s largest and fastest growing job sector in the long term.
Those jobs . . . pay an average of $90,000 per year, which translates into discretionary cash that’s pumped back into the local economy.
But although Plano pitches itself as a “prime location for financial services companies,” [Bane] said, the city has “very intentionally” tried to balance out its job base.
“What that does is cushion you against any kind of economic shock you may experience from an industry downturn,” she said.