One in two New York City workers may soon be underemployed and in economic pain.
The city is now teeming with a vast hidden underclass of underemployed workers who don’t show up in official government statistics: More than 1.6 million people, or a staggering 45 percent of the local labor force, are struggling because they don’t have enough hours in their work week, according to a new report by the Robin Hood Poverty Tracker in association with Columbia University.
And the massive ranks of these underemployed seems set to surge further in the months to come, as many New York employers slash hourly payrolls while the minimum wage rises to $15 an hour, The Post has learned.
Starting on the first of this year, small business owners were required to raise the hourly rate by $1.50, bringing it to $12.
“These new results underscore the fact that low-income New Yorkers don’t need just any job. What they need are good jobs that will provide enough hours, pay a living wage and help them move out of poverty,” said Steven Lee, a managing director at Robin Hood, a New York-based nonprofit organizaton that was founded by Wall Street titans and which assists poorer communities.
The full scale of New York’s hidden underemployment has taken many experts aback. In fact, Lee said he himself was personally surprised.
The Department of Labor puts New York City’s unemployment rate at 4.7 percent.
Underemployment comes in at 8.7 percent by a measure that includes the unemployed, discouraged and others.
By contrast, Robin Hood uses a more specific and, some say, a more realistic metric — that is, workers who are working fewer hours than they would like.
“The headline number just shocks me. It is extremely high,” said Professor Constantine Yannelis at the NYU Stern School of Business, of the 1.6 million people identified by Robin Hood as underemployed. That exceeds the entire population of Philadelphia.
“The numbers for New York City probably understate the problem, in that people probably have to leave the city if they are underemployed,” Yannelis added. “It is not the kind of place to hang around, for instance, if you are unemployed, or in a job and not earning enough, because of the city’s high cost of living.”
One underemployed worker interviewed by The Post said it’s all she hears: employers reducing hours and moving many full-timers to part-time status.
Some employers are also eliminating many low-wage jobs. Restaurant chain Red Robin said last week it will fire bussers at each of its 750 restaurants nationwide in a bid to shave $8 million this year.
The official ranks of New York City’s underemployed, which does not include informal workers paid off the books in cash, have been steadily building.
Although most are not counted as underemployed, the number of local low-income workers in the past decade alone has more than doubled from 25 percent of the labor force to 56 percent, since the end of the Great Recession through 2016, according to government data.
The Robin Hood Poverty Tracker crystallizes the wide-scale misery, according to analysts.
“There has been a significant hollowing out of the middle class in New York City over the past 20 years,” said Yannelis.