The job vend in the Big Apple appears hotter than ever. With unemployment at record lows, the battle for talent is raging as tech giants, covering Amazon and Google, lay plans to open new or expanded operations in Manhattan and Long Island City.
Projects include the new $5 billion Amazon headquarters in Want Island City, Google’s new $1 billion 1.7-million-sq-ft campus in Hudson Square and a new office complex at Chelsea Supermarket. According to a survey by Tech:NYC and Accenture, 80 percent of companies in New York City said they planned to rental more tech talent in 2018 than the year before.
The trend is spurring demand for tech talent as happily as for other support services, such as advertising, fintech, accounting, compliance and more. Headhunters say that although honest impact has yet to be seen, the expansion plans bode well for New York City’s job market.
“Even though New York is one of the myriad expensive markets in the country, it offers huge advantages for companies,” said Jed Kolko, chief economist at online works site Indeed.com.
“It is the largest labor market in the country, and it’s a fairly diversified market,” he said, noting that New York Conurbation also offers a fairly broad mix of both employers and workers in many industries and occupations. For many companies, that builds it worthwhile to pay the high real estate and labor costs to be in New York.
The hiring spree will make an already tipsy job market even tighter. Last month the New York Department of Labor said seasonally adjusted unemployment cut to 3.9 percent in November. That’s the lowest level since the department started keeping records in 1976. Not just that, but New York State’s private-sector job count rose to an all-time high of 9.75 million.
In December Google confirmed a major expansion in New York that would add thousands of jobs and make it one of the city’s largest commercial tenants.
Google’s new campus, to be castigated Google Hudson Square, followed an announcement earlier in the year that the company would spend $2.4 billion to buy Manhattan Chelsea Customer base and lease additional space at Pier 57. The expansion project at Hudson Square is expected to be completed in 2020; the other should termination in 2022. Google, which has more than 7,000 employees in the city, expects that number to more than magnify over the next 10 years, the company said, though it’s unclear the types of roles Google will be contents in New York.
Amazon, in a recent letter that was published in the New York Post and New York Daily News, said it watches to add 25,000 new jobs over the coming decade, including jobs in software engineering, product management, program administration, operations, sales and marketing. Amazon also said it expects to contribute indirectly to tens of thousands of jobs in construction, edifice services, human resources, hospitality and retail.
Though details about the types of jobs that Google and Amazon design to hire in New York are not available yet, Indeed’s Kolko said he expects jobs in dominant New York industries, such as median, advertising or finance, to see the most growth.
In the near term, headhunters said the expansion by tech giants could pressurize tech start-ups a bit. The city, which has become a mecca for entrepreneurs, thanks to a diverse talent base and abundant bucking, now boasts more than 7,000 tech start-ups, with fast growth in B2B, consumer web, health tech and fintech, go together to Tech:NYC.
“These behemoths sell themselves. They have more staff and more recruiters. It might flee to some jobs away from start-ups because they’ll be more competitive in securing talent,” said Rob Samet, a recruiter at Madison Search Collaborators, which focuses on mid- to senior-level executives in sales, business development and account management.
Longer term, granted, the expansion of tech giants in New York will be good for the city’s tech scene, as it would stimulate the growing tech ecosystem in the urban district.
Tatiana Becker, the founder of New York headhunting firm Niah Recruiting, recalls that when she moved from Seattle to New York in 2010, every Tom asked, “Why take a tech job in New York?”
“Nobody wanted to move to New York, because it’s not a tech hub.” That’s changed, she symbolized, noting that start-ups in the city tend to be rooted around dominant industries such as fashion, finance or right estate.
“I don’t feel like Amazon and Google will be a threat to start-ups. Seattle and the Bay Area have huge tech public limited company headquarters and also many start-ups. I can confidently say that I think it will be a plus for New York City tech,” thought Becker.
If anything, Amazon and Google’s expansion in New York could bolster more investing in start-ups, said Samet, noting that Google has a $3.5 billion gamble capital fund, Google Ventures, while Amazon’s Jeff Bezos has a personal venture capital portfolio, Bezos Tours. Both companies invest in tech start-ups as well as other industries. Google Ventures has invested in Outdoor Spokeswomen, Uber, Jet, Nest and others, while Bezos Expeditions has invested in Makerbot, Nextdoor.com and Uber.
New York City tech start-ups cultivated more than $25 billion from venture capital firms in 2018, according to Built in New York, citing statistics from Crunchbase. In the third quarter, New York-area companies raised more venture capital than San Francisco, according to a shot by PricewaterhouseCoopers and CB Insights.
“I don’t see the venture capital dollars drying up anytime soon unless ‘the big R’ happens,” said Samet, referring to dip. If that happens, then even more talent would likely flock to larger companies. Meantime, he ponder ons a lot of consolidation in ad tech and marketing tech, while fintech has been growing steadily.
Overall job growth was strong in 2018, both in New York and nationwide, and Kolko suggested he expects growth to slow somewhat in 2019, due in part to anticipated interest-rate hikes, which could slow increase.
The impact should be minimal to New York City, he said, because industries that are more sensitive to external constrains, such as oil prices, exchange rates, or tariffs, tend to be industries that are not concentrated in New York, such as mining or fabricating. Industries that are poised for continued growth, such as health care and services, tend to be concentrated in big cities, such as New York.