New York’s Economic Recovery Is Only Good News for the Rich

New York City’s income inequality problem continues to worsen. The city is recovering from the COVID-19 economic slump—but not every resident benefits. This “economic recovery” is good news for the rich, while the poor struggle even more. Recent census data shows that only the highest earners have been able to leverage the so-called labor shortage to receive substantial pay increases. As a result, the gap between the richest New Yorkers and everyone else continues to widen. Manhattan now has the biggest income gap of any large city in the country.

This yawning abyss is most drastic when comparing the highest to the lowest earners. From 2019 to 2022, the gap between the average pay of finance workers and food service workers increased by 21%, adjusted for inflation. But even the gap between middle-income workers and the highest earning workers has increased since the pandemic. For instance, from 2019 to 2022, the gap between the average pay of workers in the finance sector and workers in the “information” sector (i.e., media, telecommunications, information processing) increased by over 7%.

NYC Department of Labor Employment and wages
Manhattan now has the biggest income gap of any large city in the country. / Source: Socialist Revolution analysis of New York State Department of Labor Quarterly Census of Employment and Wages.

But these numbers don’t tell the full story, as they only analyze wage earners. According to the New York Times, the wealthiest 20% of families in Manhattan had an average household income of $545,549 in 2022, compared to just $10,259 for the bottom 20%. And from 2019 to 2022, the median household income in Manhattan when adjusted for inflation actually fell by 7%.

Meanwhile, the cost of living continues to increase in the New York City Metropolitan Area, with the Consumer Price Index increasing by over 6% from March of 2021 to March of 2022. The wealthiest New Yorkers can absorb this cost without batting an eye, while low- and middle-income New Yorkers already living paycheck-to-paycheck are stretched to the limit.

As a result, workers in the service industry often work multiple jobs, 60 to 70 hours a week, just to make ends meet. This is unsustainable and will drive low-income New Yorkers out of the city, further exacerbating inequality.

As Marxists, we understand that this dramatic increase in inequality is a natural outcome of the contradictions ingrained in the capitalist system. This issue cannot be legislated away through modest increases in the minimum wage. There will always be an unresolvable tension between capitalist profits and workers’ wages, between supply and demand, until this rotten system is overthrown once and for all.

This is why the IMT has set itself the task of building a mass communist party to guide the workers to seize power from the capitalist class. If you’re tired of watching New York City turn into a playground for the rich and want to fight back, then get organized in the fight for communism!

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