Back to New York
July 10th, 2006
The news that corporate headquarters are returning to New York would see to fly in the face of conventional wisdom about technology making cities obsolete, writes Paul Krugman in today’s Times (available only to subscribers to Times Select). But actually, he says, technology has helped make Manhattan attractive: Top executives can work in New York — enjoying its many advantages — while lower levels employees work in cheaper places, communicating with the headquarters in New York. In other words, according to Krugman, “relatively low-paid finance jobs are moving out of New York, while highly paid jobs are actually moving in.”
This is not an unalloyed good, the columnist says. “The city has essentially lost all of its manufacturing, and it’s now in the process of outsourcing both routine office work and many middle-management functions to other parts of the country…. Economic disparities in New York, as in the United States as a whole, are wider than they have been since the 1920s,” Krugman writes. “But for once, let me focus on the positive: The world’s greatest city, a city that a generation ago seemed to be in irreversible decline, seems to be doing OK.”
By Gail Robinson on July 10, 2006, 7:40 amIn category: Gotham City, Public Finance | 1 Comment »


July 10th, 2006 at 11:36 am
“The city has essentially lost all of its manufacturing, and it’s now in the process of outsourcing both routine office work and many middle-management functions to other parts of the country.”
This has already happened, and some of those functions were automated out of existence rather than relocated. There was a time before voice mail, e-mail, word processing, electronic data interchange, etc. Then the city shed tens of thousand of “pink collar” jobs, along with the middle managers who supervised them, in the 1980s and early 1990s. I’m not sure how much there is to lose.