Wall Street has anchored the New York City economy for years, but the administration of finance veteran Michael Bloomberg doesn't think that's such a good thing.
At a breakfast forum featuring City Hall insiders working to make the city the hottest spot for digital innovation in the world, Economic Development Corp. President Seth Pinsky said Wednesday that he and the Mayor's office hope to wean the city off its dependency on Wall Street by fostering the growth of other industries -- especially tech.
In recent years we became very heavily reliant on single sector, and that was Wall Street. At the peak of the market in 2007, Wall Street accounted for something like 7 or 8 percent of all private sector employment and 34 percent of private sector payroll, said Pinsky, who joined city Chief Digital Officer Rachel Sterne and other panelists at the Eventi hotel in Manhattan.
About 120,000 people work in digital companies or start-ups in the city, and Pinsky said that number is continuing to grow.
Even though we'd like to see the continued prosperity of Wall Street and all sectors in the city -- and our goal is not to shrink Wall Street but to grow other sectors -- I don't think any economy, over the long term, is sustainable if it is reliant on one given area, he said.
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Bloomberg has said he wants Silicon Alley to surpass Silicon Valley, and the goal is as ambitious as it sounds. When Bloomberg finishes his third term and leaves office in less than two years, he hopes a huge part of his legacy will be making New York City the world leader in web and mobile technologies.
The city has already launched a number of projects to put it well on its way to meeting that goal. Sterne, a digital consultant and founder of citizen journalism site GroundReport.com who was hired by the city one year ago to lead its digital operations, has spearheaded a number of projects. Just to name a few: a BigApps competition for iPhone apps that use city data; a hackathon to improve NYC's website; and -- announced on Tuesday -- a digital jobs map that shows start-ups in New York City with the aim of helping and encouraging the brightest techies in the world to bring their business there.
Also present at the panel were Cornell-Technion Innovation Institute Director Craig Gotsman and Provost & Dean of Cornell NYC Tech Daniel P. Huttenlocher. Cornell University of Ithaca, N.Y., and Technion of Haifa, Israel, were selected by Bloomberg to win a $100 million grant from the city last December to build an engineering campus, CornellNYC Tech, on Roosevelt Island.
Take one look at the digital jobs map, however, and it's hard to ignore that most of these exciting projects are happening in Manhattan. Brooklyn Councilwoman Letitia James, who attended the panel, said she wished that Bloomberg's tech team would do more to make sure talented Brooklynites didn't get left out of his big plans.
In a phone interview, James -- who represents Fort Greene and parts of Clinton Hill, Crown Heights, Prospect Heights and Bedford-Stuyvesant (Council District 35) -- said she was happy her borough was working with New York University to bring an applied sciences institute to the borough. But she was worried about the lack of public transportation from her district to potential jobs in Brooklyn's own tech triangle (DUMBO, Williamsburg and Downtown Brooklyn) or the Brooklyn Navy Yard, the site of most tech companies' offices in the Brooklyn area, and efforts to increase diversity in a field that traditionally lacks many women, blacks or Latinos.
According to Census data compiled by the Wall Street Journal, the unemployment rate in Brooklyn is 10.9 percent, and that number increases to 16.7 percent for blacks. The majority of James' district is black.
James said she's spoken with people in the Bloomberg administration but there's been much more talk and analysis within the department than action. Analysis to the point of paralysis, she said.
The panelists did touch on the topic of diversity when one of the moderators asked a hypothetical question about an aspiring techie working out of a new apartment building in Tish's district.
Now they're ready to start hiring people, but the rents are high, the bureaucracy is a little bit cathartic -- what are the barriers to growing the tech sector? asked Kenneth Fisher, a lawyer active in city politics and formerly worked for the Brooklyn Democratic Party.
Sterne highlighted a supportive community of entrepreneurs and business incubators that help startups get off the ground by offering office space and extra cash. Pinsky spoke of a program in which the Cornell-Technion school would work with public schools to teach digital skills to kids and families.
James said she still wasn't convinced. But the councilwoman, who announced in March that she was considering a run for public advocate in 2013, added that solving those problems may be something for the next administration.
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Ed. Note: the author of this article interned for Rachel Sterne during the summer of 2009 while she was CEO of GroundReport.com.