A city in chains. (CUF)

James Joyce once puzzled whether it would be possible to cross Dublin without passing a pub. As it turns out, despite having more than 22 pubs per square mile, with the help of a computer algorithm, it just barely is. Today, after The Center for an Urban Future released its fifth annual study ranking the national retailers popping up all over in New York City, it might have found a harder puzzle to solve. With a reported 24 locations per square mile, is it possible to cross New York without passing a chain store?

The report showed a 2.4 percent increase in the total number of chains over the past year, despite prominent retailers like Filene’s Basement and Betsey Johnson closing their doors. It is boom maintained by trusty stalwarts like Dunkin Donuts, which opened 18 stores in the last year for a total of 484 citywide, followed closely by Subways, with 454 locations, and despite seeming to be on every street corner, Starbucks, with a mere 272 locations.

The number of national retail store locations grew in every borough but Staten Island. The Bronx, at a pace of 4.3 percent growth, grew the fastest, going from 809 store locations in 2011 to 844 in 2012. It is the second consecutive year of rapid retail expansion in the Bronx. Both Manhattan and the ever-expanding Brooklyn registered a 2.6 percent increase this year. Queens, not to be left out, was up 2.1 percent. Staten Island had a 0.7 percent drop (not attributable to washouts from Sandy, it would appear).

Overall, the total number of 310 retailers included in the study accounted for a massive 7,190 stores in the city. That;s a whole lot of the generic branding for a city that prides itself on (or at least pretends to) being unique.

It’s a testament to the city, somehow, that while walking a mile past the brands, chains and logos, that it can still feel like anything but the strip mall it’s hoping not to be.

They might have tried for a bank loan, or made do until they saved enough for the renovation, but neither option was very appealing, so the Hillises did what everyone with a creative vision and a lack of cash seems to do these days: they launched a crowdfunding campaign.

“I don’t think it’s any different or less valid than when PBS or NPR ask people to donate for a free tote bag, or the Kickstarter campaign in Detroit to build a life-size statue of RoboCop,” said Mr. Hillis, who has thus far raised about $7,000 (with two weeks to go on a $50,000 campaign) on Indiegogo. “As long as you’re transparent about where the money is going, you’re putting together something that people want to be a part of.”

Although it might seem counterintuitive—aren’t businesses supposed to get their money by selling things?—crowdfunding has become increasingly popular among entrepreneurs. Using online platforms like Indiegogo, Smallknot and Lucky Ant, businesses have raised money to cover everything from startup costs and special projects to operating expenses. For the business owner, the appeal is obvious: loans are hard to come by, while online fundraising provides access to what is essentially interest-free (and sometimes entirely free) capital, depending on the perks and in-kind services they offer in exchange—which run the gamut from being worth as much as the contribution to a thank you card.

In a place like New York, where hyper-gentrification has driven many popular businesses from neighborhoods, it’s clear that mom-and-pop’s, even popular ones, sometimes require more than patronage to stay afloat. And rather than bemoaning their demise, many people are willing to pay for the luxury of keeping them.

“I think that more and more people are recognizing that small businesses are integral to community identity and they’re also an endangered species in many places,” said Jonathan Bowles, the director of the Center for an Urban Future. “I do think that many people are going to be increasingly putting money up to ensure that their favorite small businesses stay viable.”

But what does it mean for the future of for-profits? Are small businesses capitalist enterprises whose success ought to be determined by the free market, or cultural institutions deserving of our protection and coddling? Can they be both?

“People want to buy local and be more connected to the businesses around them,” said Slava Rubin, the co-founder of Indiegogo, where small businesses have been crowdfunding since 2008. “It’s emotion and commerce coming together.”

Indiegogo is organized around the belief that anyone should be able to raise money for anything, as long as they’re upfront about where the money’s going and what they’re offering in exchange for contributions. Its many successful campaigns prove that people will “fund” or “contribute to”—both Indiegogo and Smallknot insist on using the language of investment and gently but firmly corrected The Observer when we referred to such monies as donations—every endeavor imaginable.

From opening a vegan donut shop (Brooklyn’s Dun-Well Doughnuts) to paying for a couple’s in-vitro fertilization (the first crowdfunded baby was born just recently), people can be surprisingly generous. Sure, some are motivated by the perks or in-kind goods and services that most businesses offer in exchange for cash (Video Free is giving away everything from free rentals to a private screening with comedian David Cross), but others seem moved by little more than the spirit of generosity. Dun-Well, for example, offered a coupon for a free doughnut in exchange for a $25 contribution. It was claimed by 58 people.

In Mr. Rubin’s view, crowdfunding allows for a shift from a basic transaction to a relationship, which is essentially the same thing as branding. “Now small businesses get to create campaigns, gauge interest in new concepts and create lasting relationships with their customers,” he said.

Sarah and Allon Azulai, a husband and wife team who operate Park Slope coffee shop Kos Kaffe, agree that crowdfunding had been an surprisingly fun way to connect with customers. The couple recently ran a Smallknot campaign that raised $4,500 for an awning to block the direct sunlight that routinely cleared out their coffee shop for several hours every afternoon.

“I don’t know if it will change the game for small business, but many small businesses, you’re just making a living,” said Mr. Azuli. “No one is putting away hundreds of thousands of dollars in reserve, so when you need an awning or a new delivery van, you almost always have to go outside to get the money.”

Kos Kaffe offered perks—like cards for free drinks in exchange for $10 investments or a coffee of the month club for $75—which made the whole thing more akin to selling goods ahead of time, Mr. Azuli said.

Indeed, Smallknot is quite insistent that perks be more than mere tokens. “It’s really important that they’re not out there shaking the cup,” Smallknot co-founder Ben Rossen said. “With patronage of the arts or a creative project, it’s easy to give for the sake of giving, but it’s really not the same when you’re giving to an existing business. I think among a lot of business owners, there’s sort of a perception out there that crowdfunding is kind of magical, this idea that people will give me money just because I’m there.”

And while crowdfunding is an excellent way to test whether a new concept will be popular, it does risk triggering resentment from customers who feel that patronizing a business should be enough. Mr. Hillis said that one customer came into the store recently and asked, “Are you the guy begging for money?”

“And while it is the digital equivalent of a handout, I wouldn’t have done it if our linoleum was crappy and we just wanted to replace it,” Mr. Hillis said, adding that he thought it was important that crowdfunding be limited to one-time projects rather than run-of-the mill replacements.

“If you’re a coffee shop and your boiler’s busted and you need a new one, well, you’re a business, you make money, why can’t you get that with your revenue?” Mr. Hillis asked. No one wants to seem like a charity case.
Yassir Raouli, who operates Bistro Truck with his wife, Elsa Leon, said that he was hesitant when Mr. Rossen, a fan of their food truck, first contacted the couple about using Smallknot to help fund Rustic L.E.S., the brick-and-mortar restaurant they’re opening.

“I wasn’t too excited, to be honest. It sounded like we were going to beg for money and I didn’t think it would be good for the brand,” Mr. Raouli said. But he was eventually won over by the platform’s focus on in-kind exchange (and his wife’s enthusiasm). The couple raised $8,000 to buy kitchen equipment, money that came through at a time when things were taking longer than expected and the couple was short on cash.

Jonathan Hack, one of the customers who contributed to Mr. Raouli’s campaign, said that he was moved to participate by his love of Bistro Truck’s food.

“The food is also definitely higher quality than a normal lunch I would get during a workweek and costs a whole lot less,” he wrote us in an email. “With Rustic, it is my understanding that they would bring this simple but creative cooking style to a restaurant setting. This is the sort of restaurant that I like to frequent.”

Many of the small business owners we talked to were, in fact, more than a little surprised by how many of their contributors were not friends, family, or even regular customers. Last year Aurora Anaya-Cerda opened La Casa Azul, a bookstore in East Harlem specializing in Latino literature and bilingual books for children. She raised almost $40,000 raised through Indiegogo. (A private investor matched the amount.)

“Seventy percent were people I didn’t know,” said Ms. Anaya-Cerda, who offered incentives ranging from t-shirts, discounts and autographed books to one’s name on a donor wall. “There were people from East Harlem, but also people from different states, London, South Korea and Australia.” Ms. Anaya-Cerda turned to crowdfunding because banks wouldn’t give her the amount of financing she felt she needed to make a go of it.

“I’m now working harder not just for myself, but for everyone,” Ms. Anaya-Cerda said.

But is crowdfunding really a solution to a lack of bank loans with reasonable interest rates, or retail rents that force out even beloved independents? Ami Kassar, the CEO and founder of MultiFunding, which advises small businesses on lending options, doesn’t think so.

“I’m all in favor of new ways for businesses to access capital,” said Mr. Kassar. “But as a country we shouldn’t be putting all of our eggs in one basket and think we’ve solved the problem. We should be focusing on getting banks to lend to small business. In my mind, crowdfunding is an experiment that’s nascent and I can’t see it having a big impact.”

The looming Securities and Exchange Committee regulations—which offer great promise in that they would allow for equity investing in small businesses—might also prove prohibitively onerous for a lot of mom-and-pop’s, Mr. Kassar said, possibly requiring them to provide costly audited financial statements to raise any crowdfunding capital at all.
“My frustration is that mostly it’s going to help tech startups,” he said. “I can’t personally see it being this magic bombshell. Nothing is as easy as you think it’s going to be.”

Even Amy Cortese, the author of Locavesting: The Revolution in Local Investing and How to Profit From It and a big booster of the practice, thinks that until crowdfunding can offer equity stakes and investment returns, its potential will be limited. Social returns are great, sure—Ms. Cortese noted that she’d contributed $40 to La Casa Azul bookstore even though she lives in Brooklyn and doesn’t know the owner—but she wouldn’t spend her savings on a small business unless she expected the money to earn a decent interest rate of 5 or 10 percent.

“If we really want to shift money from big, bad Wall Street companies to ones that we care about, people will need a return on investment,” said Ms. Cortese. “You can’t retire on a film credit or a t-shirt.”

kvelsey@observer.com

Here's some stats, followed by, of course, some concerns regarding where all these designers are going to live and work, and show their wares.

• In 2000, there were an estimated 23,143 designers working in the New York City metropolitan region. By 2009, that number had almost doubled to 40,470—an increase of 75 percent.
• No other city has nearly as many practicing designers as New York. While the New York City metro area had 40,470 designers in 2009, the Los Angeles metro area was next on the list with 23,170 designers, followed by Chicago (19,260) and Boston (10,920).
• In 2009, the five boroughs of New York had 40 percent more architectural firms than the next closest U.S. city (Los Angeles) and two thirds as many as the third closest (Chicago).
• New York has 50 percent more interior design firms than Los Angeles
• New York has nearly twice as many members in the major industry association for graphic design companies (AIGA) as any other city. Fourteen percent, or 3,000 out of 22,000 AIGA members, are based in New York City; Chicago is next among cities with 1,200 members and Los Angeles has 1,100.
• A vast majority of the city’s design firms are located in Manhattan, but, the number of companies in Brooklyn has exploded in recent years. Overall the number of Brooklyn-based firms grew from 257 in 2001 to 433 in 2009, a 70 percent increase. The number of graphic design firms in Brooklyn grew by 62 percent in that time, from 86 to 139, and the number of architectural firms nearly doubled, from 65 to 129.

But!

The report points out that while the Bloomberg administration has admirably launched several new initiatives to support the city’s fashion industry, the city’s economic development agencies have not devoted any meaningful attention to other design industries and the city has also done little to promote the city’s designers. The report shows that other major design centers like London and Milan go to much greater lengths to brand their products at both local and foreign trade shows. Indeed, the vast majority of the designers we interviewed thought New York was far too complacent about its status as a design hub.

tacitelli@observer.com :: Follow me on Twitter

Unsurprisingly, the borough still contains the majority of New York City’s private-sector jobs—61.6 percent. But Manhattan’s share has decreased steadily in the last half-century, and the 2008 figure was in fact not far from the all-time low, 2004’s 61.1 percent. By way of contrast, Manhattan held 67.6 percent of private-sector jobs in 1958.

Perhaps most jarring, according to the report, the anticipated financial recovery won't actually mean recovery for financial services, at least not to the point where the industry was just a year ago:

[T]he city’s financial services sector, concentrated in Manhattan, has taken a disproportionate and perhaps permanent hit. When the economy picks up again, Manhattan will undoubtedly bounce back. But if historical trends continue, it won’t see as large a share of the new jobs as it did a half century ago.

Prevalent pessimism to the contrary, there were 3,123,467 private-sector jobs in New York in 2008, and unemployment in the city was slightly lower than the national average. The real estate industry closely watches jobs figures, as realities like office and apartment vacancies as well as commercial and residential rents are closely tied to them.

Manhattan’s decline accelerated in 1987, the same year that Brooklyn’s share began to reverse its slide—and the same year, thanks to the stock market crash that October, when the city faced its last great financial crisis.

In 2008, third-place borough Brooklyn gained on Queens, threatening to close a gap that opened when Queens overtook Brooklyn in 1978. In 2008, Brooklyn’s share of the private-sector employment was 14.09 percent, while Queens’ was 15.07 percent.

Shifts in New York’s employment landscape suggest ramifications for the real estate world: More jobs mean more demand for office space, and more employees with money to spend on apartments. Manhattan may look a little bleaker in coming months if current trends continue.

Indeed. Most people by now are aware that middle-class denizens of New York are at the mercy of two powerfully destructive countervailing forces: Things cost more and more, and their money is slowly worth less and less. The CUF used a cost-of-living index created by comparing the costs of housing and items such as groceries to the national average to show that Manhattan is far and away the most expensive city in the United States, with a cost-of-living index of 224.2. San Francisco, the second most expensive urban area, had an index of 173.6, and Queens, long thought of as the cost-friendly borough for Archie Bunker and his pals, had the fifth highest index score, ahead of Los Angeles/Long Beach.

The punch to the gut, so to speak, isn’t just that things are outrageously expensive in New York, but that they have gotten progressively more so, especially since the recovery from the 2001 dot-com recession. From 2002 to 2007, the prices for milk and home heating oil increased by 60 percent and 125 percent, respectively.

Over the years, no big-ticket New York City item has seen such rampant appreciation as home prices, which increased 77 percent from 2002 to 2007. Just imagine if you paid $500,000 for a home in the early ’00s (putting down a $50,000 10 percent down payment, for instance). By 2007, it would have been worth $885,000. But unlike most other things measured in the report, which are expected to hold their value in the short term, housing prices are fated for a short-term splashdown.

And in this, an opportunity presents itself.

For people who bought property in the basement, whether it was in 2001 or previous recessions in the early 1990s or late 1970s, the rapid escalation in home prices afterward can be the proverbial elevator ride to the penthouse, and propel these lucky opportunists from the lower rungs of the middle class into the upper middle class and beyond.

New York City is a feudal-like town, where property is king, and where ZIP codes, neighborhoods and views have as much say in peoples’ lives as wages earned. The trick is picking the right time to buy, when external forces artificially (and temporarily) push property prices down.

Now might be one of those times. Sure, real estate brokers are saying it’s a buyers’ market, but that doesn’t mean it isn’t true. With the collapse of the Wall Street economy, property prices are poised to head south by an indeterminate amount and for an indefinite period. For people clinging to the rungs of the middle class, it means they can start looking to buy in neighborhoods they used to be priced out of: neighborhoods a little more attractive to middle-class families, with good public schools and shorter commutes to and from work.

Take the Upper West Side as an example. In 1992, the median sales price for co-ops and condos bottomed out at $230,000 (in 1992 dollars); by 2007, that figure had spiked to $895,000 (in 2007 dollars). The mid-’90s housing recession was, then, a great time to buy into a slice of the Zabars-for-lunch, relieve-the-nanny-at-six lifestyle.

The question is whether middle-class New Yorkers will be able to take advantage of the discounted property values. The standard definition of middle class is people making 80 to 120 percent of the middle income in a given area. According to the most recent survey, taken in 2007, the median household income in New York City is $48,631, which puts families earning between $38,905 and $58,937 in the middle class (congrats!). To put middle-class earnings in perspective, a salary of $60,000 in New York is equal to earning $26,092 in Atlanta and making $35,405 in Boston once the variances in cost of living are considered.

With credit markets as tight as they are and homeowners having to make larger down payments, it would take some Lehman-esque creative financing for a middle-class wage earner to secure a mortgage for a $300,000 New York home. But the hope is that when (or if) credit markets loosen, well-qualified middle-class New Yorkers can jump on what bargains there are, and ride them to the next top.

Housing depreciation won’t and can’t be a cure-all for the systemic ailments endured by New York’s middle class, but it can help some people on a case-by-case basis, something that Jonathan Bowles, the director of CUF and an author of its report, admits.

“It is a clear opportunity for people looking to get into the housing market, who couldn’t do it over the past 5 or 10 years,” Mr. Bowles said. “But it’s not like the phone bill is going to fall by 30 percent.”

Joel Kotkin, a research fellow at Chapman University in Orange, Calif., and a co-author of the report, is hoping home prices take a big tumble. “I know it will offend some people in the real estate business,” Mr. Kotkin said, “but a 30 percent drop in real estate prices would be a very healthy thing for New York City over time.”

ohaydock@observer.com

The 53-page report, titled Reviving the City of Aspiration, lays bare the struggles of the middle class in New York: skyrocketing costs; stagnating wages; underfunded public education; and perhaps most frustrating, a disinterested city government. And they’re not taking it sitting down: the plight of the middle class is becoming the flight of the middle class—with the city’s vital center fleeing for more hospitable places like Charlotte, where 1,893 New Yorkers fled to in 2006, and Philadelphia, where 3,635 emigrated in 2006.

The paramount concern is, of course, skyrocketing property costs. In December, the median sales price for a Manhattan apartment was $900,00, an impossible price for the middle class, which is generally defined in the city as those households making up to $150,000. And the effective citywide rent was $2,801 in late '08 (that’s $33,612 in rent per year).

A good portion of the data in the report was compiled prior to the collapse of the financial markets, so you can imagine how the middle class, a long-suffering segment of the population reeling from years of misfortune, is faring in an economic climate that has heaped fresh piles of misfortune on everyone.

We've sat down in the last few months with two of the report's authors on some of these issues. Here's the one with Center for an Urban Future director Jonathan Bowles; and the one with urban expert Joel Kotkin.

Here's more findings from the report, per the CUF:

Twice as many New York City residents relocated to Philadelphia in 2006 than in 2000 (3,635 compared to 1,811). During the same period, the number of city residents moving to Charlotte, N.C., also doubled, from 904 to 1,893, while the number relocating to Lehigh County, Pa.—home to Allentown—more than tripled (from 648 to 2,101), and the number leaving for Gwinnett County, Ga.—a suburb of Atlanta—nearly tripled (from 762 to 2,121).

More residents left the five boroughs for other locales in each of the years between 2002 and 2006 than in 1993, when the city was in far worse shape. In 2006, the city had a net loss of 151,441 residents through domestic out-migration, compared to a decline of 141,047 in 1993; every borough except Brooklyn saw a higher number of out-migrants in 2006 than 13 years earlier. Overall, in 2006 the city had a higher net domestic out-migration rate per 1,000 residents (-18.7) than struggling upstate communities such as Ithaca (-8.0), Buffalo/Niagara Falls (-7.6), Rochester (-5.8) and Syracuse (-5.1).

We document in the report that the city has been losing, or is at risk of losing, many key constituencies:

· Individuals with bachelor’s degrees. Even before the economic boom ended, every borough was losing educated professionals. In 2005, New York City had a net out-migration of 12,955 individuals with bachelor’s degrees; a year later, the number had spiked to 29,370—an increase of 127 percent. Brooklyn had the largest out-migration that year, losing 12,933 compared to 5,984 in 2005.

· Families. While much has been made of Manhattan’s so-called “baby boomlet”—the borough’s number of toddlers under the age of four grew 26 percent between 2000 and 2004—our data shows that many of these new families don’t stay into their kids’ school-attending years: the percentage of children in Manhattan over age five drops well below the national average.

· Immigrants. Growing numbers of immigrants who have attained a degree of success in New York—including many business owners—are leaving the five boroughs for other cities, particularly in the Southeast and Southwest, where housing is cheaper and growing immigrant communities present viable new markets. For instance, our research suggests that growing numbers of Hispanics are moving to the Charlotte, NC area, and to communities in Georgia and Florida.

· Municipal workers. A job in city government was once a ticket to the middle class, but many municipal employees today have all but given up on living in the city.

· The black middle class in Eastern Queens. The borough of Archie Bunker has nurtured one of the nation’s largest black middle class communities throughout a handful of adjacent Eastern Queens neighborhoods. But community leaders worry that the precipitous rise in real estate prices during the past decade, combined with stagnant wages, will make it difficult for the current generation of black New Yorkers to afford home ownership in these areas. As it is, the number of black residents in Manhattan and Brooklyn recently declined for the first time since the 1800s.

In addition to middle class flight, the city is increasingly bifurcated, with the path from poverty to the middle class more arduous than ever.

· During the years of economic growth from 2003 to 2007, average weekly wages, when adjusted for inflation, barely increased in the boroughs outside of Manhattan—rising by just 0.4 percent on Staten Island, 0.6 percent in Brooklyn, 1.4 percent in Queens and 2.5 percent in the Bronx. In Manhattan, the increase was 21.8 percent.

· The historical trends are just as bleak: Between 1975 and 2007, while average real weekly wages nearly doubled (increasing by 96 percent) in Manhattan, they went up by 1.1 percent in Queens, 1.7 percent in Brooklyn, 2.5 percent in Staten Island and 8.6 percent in the Bronx.

What’s making life so tough for the middle class?

Cost of Living:

· The ACCRA Cost of Living Index, an analysis by the Council for Community and Economic Research, finds that Manhattan is by far the most expensive urban area in the United States, with an aggregate cost of living (224.2) more than twice the national average (100) and considerably higher than the second most expensive city (San Francisco, at 173.6).

· The other boroughs don’t necessarily provide much relief: Queens had a higher cost of living (156.2) in the third quarter of 2008 than all but four of the 315 major urban areas measured. Only Manhattan, San Francisco, Honolulu (163.6) and San Jose (157.4) were more expensive.

Housing costs

· In the third quarter of 2008, only 10.6 percent of all housing in the New York City region was affordable to people earning the median income for the area—the lowest share of any major metro area in the United States.

· The city’s “average effective rent” during the fourth quarter of 2008 was $2,801, 53 percent higher than the second place city (San Francisco, $1,827) and almost three times the national average ($995).

Child care costs

· According to government estimates used to gauge the value of vouchers and other subsidies, the market rate cost of nursery school for toddlers in New York City is $13,260 per year; for infants it is $19,240. But, depending on the neighborhood, sending a child to daycare for the full day, five days a week can cost as much as $25,000 a year.

· Middle class families are the most likely to feel the squeeze. They earn well above the $47,700 cut-off for city-issued vouchers or federally subsidized programs like Head Start, but often cannot manage the five-figure cost of day care.

Other costs

· Between 2002 and 2007, New Yorkers have had to pay significantly more for everything from home heating oil to water bills. During this period, the average property tax bill for a 1, 2 or 3 family home went up by 67 percent; home heating oil costs increased by 125 percent; telephone bills by 16 percent, water bills by 34 percent, electricity costs by 27 percent; milk prices by 60 percent and apartment prices by 16 percent.

NYC’s Economy is not producing middle income jobs

· Manufacturing jobs have disappeared all over the country, but New York City and its metropolitan area have done worse in retaining this sector than almost anywhere else. In 2007, the manufacturing sector accounted for just 3.2 percent of all private sector jobs in New York City and 4.6 percent in the New York City metro region. The sector employs a much larger share in other major regions, such as Los Angeles, where manufacturing accounts for 12.7 percent of all private sector jobs; Chicago, in which 11.3 percent of private sector jobs are in manufacturing; Charlotte (10.8 percent), Houston (10.6 percent), San Francisco (8.0 percent) and Boston (7.1 percent).

· New York has done almost as poorly in other blue collar sectors. Nationwide, employment in the wholesale trade sector grew by 12.6 percent between 1990 and 2007. However, in New York City and the New York metro region, employment in the sector declined by 22.2 percent and 22.1 percent, respectively, during this period. Other major metro areas did much better: the sector grew by 29.0 percent in Charlotte, by 23.9 in Houston and 0.6 percent in Los Angeles, while it declined by comparatively smaller percentages in Chicago (a 4.2 percent decrease), San Francisco (4.9 percent), Philadelphia (11.9 percent) and Boston (13.4 percent).

· Like other U.S. cities, New York has seen substantial growth in low-wage sectors like retail and hospitality. But another sector that pays poorly, health care and social assistance, accounts for a much larger share of all private sector jobs in New York than other cities. In 2007, the sector accounted for 17.4 percent of all private sector jobs in New York City and 16.9 percent in the metro region, up from 12.7 percent and 12.1 percent respectively in 1990. By comparison, Charlotte (8.6 percent), Washington, DC (9.7 percent), San Francisco (10.8 percent), Houston (10.9 percent), Los Angeles (11.0 percent), Chicago (11.8 percent) and Boston (15.8 percent) all had smaller shares of their private workforce in this field in 2007.

· Unfortunately, the industries expected to grow the most in New York during the decade ahead almost exclusively pay low wages. Of the 10 occupations that are expected to have the largest number of annual job openings in the city through 2014, only two offer average annual wages greater than $28,000.

Commuting times are too high in most middle class neighborhoods

· With housing prices in Manhattan practically out of reach for all but the affluent, the other four boroughs have become increasingly crucial to the city’s hopes to retain its middle class. But one tradeoff for many middle class New Yorkers who moved to city neighborhoods outside of Manhattan in search of reasonably priced housing is a transportation infrastructure that is unable to meet the growing demand. The dismal result is overcrowded subways and buses and some of the nation’s longest commuting times.

· And it isn’t only people living in Far Rockway, Tottenville and other communities on the city’s outer reaches who suffer through super long commutes. The average commuting time is 38.5 minutes for those living in Greenpoint; 37.6 minutes from Astoria; 49.5 minutes in Ditmas Park; and 41.7 minutes in Bay Ridge. These communities have all experienced a significant increase in middle class professionals in recent years.

· The commutes are typically even longer in a number of other traditional middle class enclaves, some of which have attracted growing numbers of first-time homeowners, such as Richmond Hill (with a 46.1 minute average commuting time), Co-op City (49.5 minutes), Bensonhurst (45.3 minutes), St. Albans (51.7 minutes) and Springfield Gardens (52.3 minutes).

· Between 1998 and 2006, 81 percent of the increase in bus ridership across the city occurred outside of Manhattan. The number of people in Manhattan riding city buses rose by 11 percent, but this was far less than the increase in Queens (24 percent), Staten Island (23 percent), Brooklyn (22 percent) and the Bronx (18 percent).

· Thirty-nine of the 50 subway stations with the largest percentage increase in ridership between 1998 and 2006 were in the boroughs or in Manhattan north of 96^th Street. Twenty-two of the 50 were in Brooklyn.

Haphazard development in the city’s low-scale neighborhoods

· A growing number of affluent New Yorkers are choosing to raise their families in upscale parts of Manhattan, at least until school age. But many middle and working class New Yorkers have opted for neighborhoods across the five boroughs with a decidedly more suburban feel. New York has dozens of these traditional middle class neighborhoods, from Bay Ridge to Whitestone, that are dominated by one- and two-family homes and offer quiet streets and a family-friendly environment. But in recent years, a number of these neighborhoods have been marred by a flurry of development not in scale with the physical character of the community, executed in a haphazard fashion and lacking the necessary infrastructure upgrades to meet the new demand.

· Few have associated concerns about unsightly or unplanned development with the struggles facing New York’s middle class. However, nearly as many of those we interviewed cited this issue as one of the key threats to New York’s ability to retain a middle class as those who listed the city’s skyrocketing cost of living.

Finally, we cite a previously unpublished study sponsored by the city that surveyed out-migrants about why they left NYC. The findings include:

· an internal study conducted for the Bloomberg administration in 2006—titled “NYC Movers Study—found that high housing costs were the number one reason people are now moving out of the city. The Movers survey attempted to duplicate a similar city study done in 1993 that specifically examined what factors had caused people to relocate out of the five boroughs.

· In 1993, the three most commonly cited “major reasons” for leaving were to have a better lifestyle (59 percent), to live in a better home or neighborhood (55 percent) and to live someplace safer (54 percent). Thirteen years later, one concern dominated: housing costs, cited by 64 percent of those asked for their “major reason” for departing.

· “What drove people out of New York City in 1993 was basic quality of life issues—crime, safety, neighborhoods,” concluded the authors of the 2006 Movers study. “What is driving people out today is basically one issue—money and the cost of living.”

Back in 1975, New York City accounted for 53.1 percent of the 5,022,801 jobs in the New York region: a broad swath of territory encompassing Suffolk and Nassau counties in Long Island; the Bronx, Brooklyn, New York, Queens and Richmond counties in New York City; Rockland, Suffolk and Westchester counties in southern New York; and Bergen, Essex, Hudson, Middlesex, Morris and Passaic counties in northern New Jersey.

By 1980, the city’s share of regional jobs had diminished to 50.5 percent, and the 12 regional counties overtook New York City in 1985 and have had a majority of jobs ever since. In 2005 – the last year the figures were tallied – the 12 surrounding counties accounted for 52.8 percent of the 6,171,642 jobs in the New York region.

Since 1975, five counties have had job growth of over 100,000, none of which were in New York City. Suffolk transformed from a sleepy potato farm county to a robust suburban economy and led all counties with 277,724 created jobs since 1975; followed by Morris County (144,410 new jobs), Middlesex County (143,127), Nassau County (123,590 new jobs) and Bergen County (105,064 new jobs). New York County led all city counties with 74,213 new jobs followed by Queens County with 73,521.

“But after a frustrating, futile four-year search for a new Brewery site to expand operations in the city, I am now asking myself a question our success should have definitively answered: Does New York City really have a place for light manufacturing businesses like ours,” Mr. Hindy writes.

He and his partner started brewing beer from a defunct, Prohibition-era facility in Bushwick in 1987, and in 1991 leased a new 75,000-square-foot plant in Williamsburg for $3.50 per square foot. The Brewery was able to withstand 15 years of sweeping gentrification, the rezoning of industrial areas, and spiking real estate prices in Williamsburg that ultimately pushed their rent to $8.50 a foot; but by 2003 they needed to expand. Thus began a tortuous and taunting search during which they saw two potential relocation sites slip out of their grasp.

Mr. Hindy recounts how the city Economic Development Corporation’s push for them to relocate to Pier 7 in between the Brooklyn Bridge State Park and the heavy manufacturing plants on the waterfront put them smack in the middle of a battle between the Bloomberg administration and American Stevedoring, the company that runs the container port there.

“We were the baby that was thrown out with the bathwater,” Mr. Hindy writes of the aborted plan.

Then the Brooklyn Brewery joined with a developer on a rejected proposal for a residential project on the Gowanus Canal. Meanwhile, Mr. Hindy supported the rezoning of vacant industrial land in Williamsburg in the hopes that they would be able to remain there. (They have seven more years left on their current lease.)

The Brooklyn Brewery’s story is worth a read and serves up a damning indictment of local government—he writes that only two city programs have helped the company in its 20-year history by reducing costs, at least temporarily.

The report urges city to get on the communal kitchen bandwagon by supporting the creation of additional kitchen incubators (small spaces with shared ovens, ranges, and industrial mixers that can be rented when needed) that give small-scale food producers access to affordable space in a licensed commercial kitchen.

A 2007 study for the city's Office of Industrial and Manufacturing Businesses found that there are more than 900 food production firms in New York City, employing over 16,000 people, along with 2,500 cooks who are self-employed and presumably in need of space.

Nonetheless, there are only four food incubators in the city: Mi Kitchen es su Kitchen in Long Island City rents the 5,000-square-foot training kitchen at the Artisan Baking Center to cooks in eight-hour shifts for around $200 during off-hours; the Womens Housing and Economic Development Corp. operates four, 1,000-square-foot kitchen spaces on the ground floor of a South Bronx housing complex; Kitchen for Hire; and one at Kingsborough Community College in Sheepshead Bay that is only open to registered students.

Together these shared facilities servce only 60 people annually, "a fraction of the demand in a city that boasts a growing number of entrepreneurs who are trying their hand at food manufacturing and catering, from high-end chocolates and gourmet pickles to empanadas and Indian sweets."

One way for the city to promote the concept is to encourage commercial kitchens and bakeries that don't operate continuously to become "mini-incubators" by renting their space to small businesses during off-hours.

Since even expensive restaurants are grumbling about high food prices lately a little hospitality (at a price) could help off-set some of their overhead as well.

In fact, New York City, whose gaming industry employs just 1,200 people, trails “gaming hubs” like Seattle, Los Angeles, Montreal and Boston (Boston?!?!), according to the study, “Getting in the Game.”

But there is some good news:

We’ll take their word for it. The rest of the release, and the actual study, are below.

STUDY REVEALS THAT NYC IS ONE OF JUST A HANDFUL OF CITIES TO DEVELOP A CLUSTER OF GAMING FIRMS; BUT DESPITE A RECENT SPIKE

IN FIRMS AND JOBS, NEW YORK LAGS BEHIND OTHER INDUSTRY HUBS

LIKE SEATTLE, LA, BOSTON AND MONTREAL

The Center for an Urban Future, a Manhattan-based think tank, released a new report today which concludes that the fast-growing video game industry represents a promising opportunity for New York City’s economy. The study shows that New York is one of just a handful of cities in North America to develop a cluster of gaming firms, thanks to a considerable spike in the number of gaming firms here in the past few years. But despite recent gains, the study finds that New York’s gaming sector faces significant challenges and still lags well behind established gaming hubs like Seattle, Los Angeles, Montreal and Boston.

The report, titled “Getting in the Game,” shows that New York City is now home to more than to 30 game development companies and another 55 firms involved in some aspect of gaming. The industry employs at least 1,200 people in the city.

While the sector is still relatively small, it has grown significantly from a few years ago, when the number of game development firms could be counted on one hand. And although New York lacks a large game development company—like Entertainment Arts, PlayStation or Ubisoft—the city has emerged as a leader in three growing sub-sectors of the industry: casual games, mobile games and serious games. In fact, New York is home to several of the nation’s largest and most well-known casual game companies—such as Gamelab and Large Animal Games.

The report, the first comprehensive analysis of New York City’s video game sector, concludes that New York has tremendous potential to cultivate a larger game industry—a prospect that, if achieved, could lead to hundreds, if not thousands, of new jobs and help the city diversify its economy. The study shows that New York has many of the ingredients necessary to be a major center for the industry: it boasts a deep pool of creative workers and it is home to some of the world’s most successful film, media and publishing companies—sectors that have similar characteristics as gaming.

“The video game sector is poised to be one of the fastest-growing parts of the entertainment industry in the years ahead,” says Tara Colton, deputy director of the Center for an Urban Future and author of the report. “While New York’s video game industry overall may be not as large as other regions, it has carved out some impressive niches, and the city has many of the ingredients to become a robust gaming hub. Given the recent economic downturn, New York needs to do more to diversify its economy, and the video game sector should be one part of that strategy.”

However, the Center’s study shows that New York faces a number of challenges in capturing a larger share of the industry’s future growth. Chief among these problems is a limited supply of technical workers, compounded by the fact that the city’s universities aren’t creating the pipeline of technical talent that local video game companies need. Other challenges include the high cost of doing business in New York and the fact that city and state economic development officials have done little to support the industry’s growth.

The report features results from the first-ever survey of local gaming executives, conducted in partnership with the New York City chapter of the International Game Development Association. 35 percent of gaming executives who responded to the survey cited the city’s high costs and overhead as one of their greatest challenges, and another 33 percent pointed to the difficulty in attracting qualified workers. In addition, 76 percent of those responding to the survey said that their companies had never interacted with the city or state government; of those who had, most cited negative experiences.

The report calls on city officials to integrate the gaming sector into their overall economic development strategy, urges New York’s universities to expand their video game programs to include a technical game design degree program and encourages universities and local game companies to forge closer ties.

The Center for an Urban Future is a non-partisan think tank based in Manhattan that has long been focused on highlighting opportunities for growing and diversifying New York City’s economy. In the past, the Center has published studies about the biotechnology, air cargo and fashion industries and written extensively about the impact of the city’s creative economy.