Economic activity likely still contracting in NY, but the damage may be leveling off in some areas of retail, tourism, real estate and employment.
By Daniel Massey

The New York area’s recession-wracked economy has shown signs of stabilizing in recent weeks, although economic activity may still be contracting, a report released today by the Federal Reserve Bank shows.
The Fed’s Beige Book, a collection of economic anecdotes on the local economy published eight times a year, shows that indicators ranging from retail sales and consumer confidence to tourism and the labor market remain sluggish, but have shown some signs of leveling off.
Retail sales in the city, which had lagged the rest of the region, picked up in June and early July, but remain 8% to 10% below comparable 2008 levels, the report says. Moderately-priced product lines have been selling better than premium or low-priced ones, according to a major retail chain cited in the report.Tourism in the city has been week, but stable since the last Fed report in early June. Manhattan hotel revenues in June were down 35% to 40% from a year ago and occupancy rates were in the mid-80s, down about five percentage points from a year earlier. Room rates were down a hefty 30% from a year ago. Broadway theater attendance was down more than 10% from a year earlier, though a 15% jump in average ticket prices starting in late May has bolstered revenue.
Manhattan’s office vacancy rate was steady in June, but asking rents continued to fall and were 15% below the year-earlier rental rates.
Most employers reported they were still reducing employment, though one leading employment agency noted that hiring has picked up a bit in the legal industry. Financial sector hiring remained virtually nonexistent.
Not all the news indicated stabilization. While the housing market showed signs of life in northern New Jersey and upstate New York, it continued to deteriorate in the five boroughs, with the steepest declines seen in Manhattan. Drops were seen in both sales and rentals. Small-to-mid-size banks reported weakening loan demand, especially in the residential mortgage and consumer loan categories, while 56% of banks surveyed reported a decrease in demand. Refinancing activity was also down and no banker reported an easing of loan standards.