Harvard economist Edward L. Glaeser has published a blog article about New York City's resilience against the recession (depression? Credit crunch? What are we calling it today?) affecting the rest of the country. Glaeser points out that New York City's housing prices dropped only 7.5 percent last year, while the nationwide average was a drop of 18 percent.
New York and San Francisco are the only cities in the continental United States where median home sale prices are above $500,000. Furthermore, New York's unemployment rate is a mere 5.6 percent, compared to 8.2 percent in Los Angeles, and 6.4 percent in Chicago. Glaeser goes on to illustrate New York's resilience in terms of population growth and density. In the last 50 years, most cities have lost 20 percent or more of their population, but New York keeps growing. (I'm sure this is linked to the stable housing prices.)
The conclusion Glaeser draws is that New York is recession proof because of its pool of talent. There is no arguing that New York City draws smart, talented people from all over the country. But as the commenters to the post point out, New York City also draws a huge pool of immigrant arrivals. The New York City Department of Public Planning released a report in 2005 that the foreign born population in New York City rose from 28 percent to 36 percent of the population between 1995 and 2000.
I love Glaeser's view of New York City as a shining city of intellectual lights, and I love the idea that smart people will Save The World. But Glaeser seems to be talking about high powered financial managers and canny heads of business. He does a disservice to New York's immigrant population, many of whom work long hours at thankless jobs for very little money.