The Empire State is losing its grip as the nation’s financial services capital.
Latest York’s financial services industry – an ideal contributor to the state’s gross domestic product – has been imperiled by the plummeting population of high-income residents, who’re fleeing amid towering taxes and rising housing costs, based on a sobering recent study.
“As other states attract talent and investment within the sector, there isn’t a guarantee of future success,” said the report from the Business Council of Latest York State.
“Addressing the state’s tax burden, business climate, and price of living might help to make sure Latest York’s position as a national and global leader for finance.”
Over the past three years, the highest 4 states landing recent high-paid financial services and insurance jobs over the past three years were Texas, Florida, North Carolina and Georgia, the evaluation conducted by the Business Council found.
Latest York ranked thirty sixth by way of percentage growth — at a rate of a puny two-tenths of 1%.
“North Carolina and Florida have rapidly added jobs within the finance and insurance sector while Latest York’s employment has remained below national growth trends,” the report said.
Each finance sector worker generates nearly an extra three jobs in other sectors — so any lack of employment ripples through your entire economy, the study noted.
“This report should serve as a call to motion for leaders across Latest York to forcefully address the competitiveness issues that threaten one in every of its most precious and important economic forces, the finance industry,” the study said.
The common compensation package in Latest York’s financial services industry is a nation-high $309,000 per 12 months — $275,800 in salary plus $34,000 in other advantages.
The figures showed continuing trends of population decline in Latest York – with a 2.7% decrease from 2019 to 2022 — marking the worst loss among the many 50 states throughout the COVID-19 pandemic.
Many of the population loss was in Latest York City and its suburbs, home of a lot of the state’s wealthiest residents.
A review of net migration of residents showed that the biggest flight of gross income was from Manhattan at nearly $11 billion.
“The info confirms the flight of the wealthiest from the Latest York City area,” the business group’s review found.
In 2021 alone, the Empire State saw a net decline of $9.8 billion in income that migrated to Florida, based on the report.
It’s not a coincidence, the study said, noting that the Tax Foundation think tank rates Latest York as having the very best combined state and native tax rate on residents, and the Sunshine State the bottom.
“This single competitive factor [taxes] is probably going playing an influential role within the migration of high-net-worth individuals as they’ve probably the most to realize by leaving a high-income tax state for a low, or zero, income tax state,” the study said.
It also identified that Latest York can be one in every of a small collection of states that levies a tax on estates, derisively referred to as the “death tax.”
“High-wealth individuals are likely factoring this tax into their location decisions,” the report said.
“Forceful motion is needed,” the evaluation concludes. “The state will need to deal with the tax burden, business climate, and price of living issues that hurt the state’s competitiveness.
“If the state doesn’t address these issues, it risks losing its dominance within the finance and insurance industry, and ultimately, jeopardizes the health and prosperity of Latest York’s economy.”