Mayor Bill de Blasio. | Michael Appleton/Mayoral Photography Office De Blasio enters election year with a growing economy, and some uncertainty

Mayor Bill de Blasio has entered his fourth year in office with a growing economy, which on its face appears to be a potential boost for his re-election efforts later this year.

But de Blasio, who made income inequality a major part of his first campaign, has seen income inequality increase slightly in the city under his watch and there are broader signs of a slowing economy, making it unclear if the current pace of growth will last through the election.


Since de Blasio took office in 2014, the city has added over 286,000 jobs, an increase of 7.1 percent compared to December 2013, the last month of then-mayor Michael Bloomberg’s administration. National job growth over that time was 5.8 percent. And average weekly earnings have increased an inflation-adjusted 0.3 percent in New York City over that time, according to numbers provided by the city Economic Development Corporation.

New York City drove New York State’s overall job growth in 2016, adding 63,500 jobs over the past 12 months, good for 62 percent of the state’s net growth. And the unemployment rate was 5.2 percent in December in the city, down from 8.1 percent in the last month of Bloomberg's term.

Alicia Glen, the deputy mayor for housing and economic development, said in a statement that "Under the Mayor's leadership we've seen our economy get stronger and more inclusive," and that "by investing in everything from manufacturing to life sciences, we'll expand those opportunities to even more New Yorkers."

De Blasio's campaign spokesman told POLITICO New York he is confident the campaign can run on de Blasio’s economic record, and that it can do so successfully in a race where the mayor already has a polling advantage. How much credit de Blasio can rightly claim for a growing economy during his re-election campaign, though, is debatable.

E.J. McMahon, a senior fellow at the Manhattan Institute and the founder and research director of the Empire Center for Public Policy, said mayors have only a marginal influence on the local economy over their first few years, and he argued de Blasio’s policies haven’t had much of an effect.

And he said that there was no immediate change in city policy under de Blasio that would have greatly affected the city’s economy.

“I think he’s largely coasted on the momentum of what preceded him,” he said.

James Parrott, deputy director and chief economist at the Fiscal Policy Institute, also said that mayors only impact the economy at the margins, but he argued de Blasio has used the city’s growing economy to help people at the bottom.

He cited de Blasio’s funding for the city’s public housing, public hospitals through Health + Hospitals and his universal pre-kindergarten program as particular ways in which the mayor has boosted lower-income residents.

Voters do reward or punish mayors for the economic performance, even if the results are marginal, according to the 2012 American Journal of Political Science study "Holding Mayors Accountable: New York’s Executives from Koch to Bloomberg," by R. Douglas Arnold and Nicholas Carnes.

The authors found that an increase of one percentage point in the economic misery index, which is the unemployment rate plus inflation, led to a half of a point decrease in the mayor’s approval.

The misery index has decreased during de Blasio’s first three years, as unemployment has deceased and inflation has remained relatively low.

But there are some significant warning signs both ahead of and beyond election day. The city’s Independent Budget Office predicted in its recent fiscal outlook that the economy will continue to grow, but that it would do so more slowly, with the city adding 67,600 jobs in 2017 and then only 49,000 by 2020.

IBO also found that President Donald Trump’s administration provides a lot of economic uncertainty; some plans Trump may pursue could have positive impacts on the city’s economy and some could have negative impacts.

De Blasio also has so far seen mixed results on the issue at the heart of his 2013 campaign: income inequality.

At a press conference in December, he argued his work on the issue has had an impact. “I don’t have a doubt in the world that a lot of what we’re doing is having an effect but we’ve got to do a lot more," he said then. He cited his pre-Kindergarten and middle-school after-school programs expansion, jobs creation, affordable housing and rent freeze for rent stabilized housing.

But the most recent available measures of economic inequality from early in de Blasio's term show slight shifts in the other direction.

In 2013, the last year of Bloomberg’s administration, the top one percent of income tax filers, 36,800 taxpayers, made 38.1 percent of the income in New York City that year. The bottom half, roughly 1.8 million filers, made 5.8 percent of it.

In 2014, de Blasio’s first year, the top one percent made 40.5 percent of all income while the bottom half made 5.7 percent, with both numbers moving in the direction of more inequality.

And a recent report by from the Manhattan Institute showed that two other measures of inequality increased in 2015, compared to 2013. The Gini coefficient, which uses U.S. Census American Community Survey data and measures inequality on a 0 to 1 scale, increased in the city from 0.547 to 0.551 from 2013 to 2015, a 0.8 percent increase.

And Theil's Index, which uses wage and employment data, shows inequality increased from 0.261 to 0.269, a 3 percent increase, from 2013 to 2015.

The city has fared better under de Blasio by another measure of economic well-being, the poverty rate. According to the U.S. Census Bureau’s American Community Survey, provided by the New York City Center for Economic Opportunity, the poverty rate in New York City was 20.9 percent in 2013 and 2014 but decreased to 20 percent in 2015.

Policy shifts in the city could result in a greater decrease in the poverty rate in the coming years. De Blasio announced a plan in April 2015 to decrease the number of people in New York City living in poverty or near poverty by 800,000 over ten years. The major plank in that plan was to increase the minimum wage to $15 per hour .

Gov. Andrew Cuomo in 2015 had called for an increase in the minimum wage to $11.50 in New York City and $10.50 in the rest of the state, calling the mayor's proposal a “ nonstarter .” But last spring, the governor announced a deal to increase the minimum wage to $15 in 2018 for larger businesses and in 2019 for smaller businesses.

With the increase in the minimum wage, CEO believes that all else equal, there will be roughly 750,000 fewer people in poverty or near poverty after the minimum wage reaches $15 per hour. Factors that could change and affect this calculation include whether the economy expands or contracts, whether there is strong inflation and whether there are significant shifts in federal and state policies.

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