Despite Uncertainty and Tech Layoffs, City Small Businesses are Growing Again

By Joe Connolly and Neil A. Carousso

NEW YORK (WCBS 880) — It appears small and midsize business owners are optimistic about their growth prospects for the rest of this year despite recession fears on Wall Street.

“They see more opportunities for growth, for bringing in revenue,” said Cory Schouten, editor-in-chief of Crain’s New York Business on the WCBS Small Business Spotlight, sponsored by Dime Community Bank.

“The catch there is that small and midsized businesses are seeing their costs increase, substantially, including their labor costs,” he added.

Crain’s recently surveyed the leaders of small and midsize businesses and found two-thirds of them expect their revenue to increase this year, but the same amount are seeing their costs rising. Half of those businesses expect to maintain staffing levels and, in fact, some report that they are hiring.

“A lot of companies are seeing this as an opportunity to go hire some tech talent that has been really impossible to hire, has been outside of their budget, but with some of the cutbacks in tech, other companies are snapping those people up,” said Schouten.

Some of those companies are raising capital and have even turned profitable.

Manhattan is an outlier in the city’s pandemic recovery, which has been more robust in the outer boroughs due to remote and hybrid work. Jobs have still not reached pre-pandemic levels.

“Office owners are updating their properties, so they’re very modern, they’re very adaptable for a flexible hybrid work environment. And, also, those owners of older office buildings in the city are looking at residential conversions,” Schouten said.

The Partnership for New York City reports office occupancy might remain at 56 percent for the foreseeable future, which is leaving the city with excess office space and few housing options until office buildings are converted. That continues to make Manhattan unaffordable for many employees.

“Right now there’s an office glut, but there’s not enough housing in the city. So, those two things can work together and kind of give us all a path forward,” said the Crain’s editor-in-chief.

Watch the WCBS Small Business Spotlight video above to see how local businesses are finding ways to grow. 

You can read Crain’s New York Business’ economic outlook for 2023, available for free to WCBS 880 listeners, here.