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N.Y. Mayor Says Job Losses in City Not as Bad as Expected

October 22, 2009
Related Topics: Downsizing, Benefit Design and Communication, Retirement/Pensions, Latest News
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Less than two weeks before New Yorkers decide whether to give Michael Bloomberg a third term, the billionaire mayor said Thursday, October 22, that the city’s job losses and pension and health care obligations would have been far worse if the city’s mayor had no management experience.

“We’re in a lot better shape than most cities and governments,” he told an audience in midtown Manhattan during a breakfast forum sponsored by Crain’s New York Business, a sister publication of Workforce Management.

The city has lost about 116,000 jobs since the financial crisis struck a year ago and now faces a $5 billion budget deficit. But Bloomberg, who is seeking a third term in office, said job losses were expected to be closer to 220,000.

New York City’s unemployment rate hit 10.2 percent in September, dipping from a 12-year-high of 10.3 percent in August.

Bloomberg’s Democratic opponent, city Comptroller William C. Thompson Jr., has criticized Bloomberg for paying more attention to the needs of Wall Street than middle-class New Yorkers.

“Mike Bloomberg has made our city a wonderland for Wall Street and a dreamland for developers while the middle class, small businesses, entrepreneurs and working families have been shut out and weighed down by the burdens of his misguided policies,” Thompson said in a speech to the Staten Island Chamber of Commerce this month.

Like many municipalities, New York has long-term pension and health care obligations toward its unionized workforce and retirees that threaten to bankrupt the city. Bloomberg said pension and health care costs now account for one-quarter of the city’s tax expenditures.

This year the city reached an agreement with the United Federation of Teachers that will save the city $2 billion in pension costs during the next 20 years. The agreement, which preserves benefits for current teachers but require new teachers to pay more into their pension plan for a longer period, still must be ratified by the state Legislature.

Still, Bloomberg said, “That agreement can be a model for other municipal unions.”

When pressed about whether he would ask city employees to forgo raises given to them earlier this year, Bloomberg said he would not because union contracts are enforceable by law.

Bloomberg also explained why, if elected, he would ask certain commissioners of city departments to step down from their posts.

“That’s what management is about,” he said. “You have to constantly shake things up.”

—Jeremy Smerd

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