By 1982, the city’s inflation-adjusted wage bill had fallen by almost 30 percent, and real investment in the city’s infrastructure fell by more than three-quarters and didn’t reach its 1974 levels until the early 1990s. The city gave up a significant amount of its autonomy in exchange for the relief it received. Ultimately, however, the reforms that were forced on the city created a responsible and transparent budgeting process that has served the city well to this day. By early 1976, the U.S. economy was recovering from a deep recession, and employment in New York City’s financial sector was once again on the rise. Overall employment in New York City began to recover by 1977, and unemployment began to decline. By the end of the decade, there were signs of hope, but it wasn’t at all clear yet whether the city was back on solid footing. While employment did rebound modestly, the city’s population was still declining, crime was still rising and the city was still having trouble borrowing. It would be 10 years after the initial crisis before the city was able to borrow again on its own in the public markets. By the mid-1980s, the resiliency of the city’s economy was becoming more apparent. City-wide employment barely declined during the wrenching recessions of the early 1980s—the first time in a long while that the city’s economy had out-performed the nation’s.
Each year, tens of thousands of low-to-moderate-income New Yorkers—many of them immigrants—send their children to one of the city’s specialized high schools. When it comes time for college, many of these same students have access to universities in the CUNY and SUNY systems. A recent highly regarded study assessed how much of an opportunity kids born to less advantaged families in different parts of the United States have of moving up in the world. New York City ranked 10th out of the 50 largest U.S. metro areas.2 The Big Apple should strive to be number one in this ranking by continuing to improve access to quality and affordable education and to job training. We should all do our part to help make this happen. Also, it is important to remember that the measure of a city’s well-being is much broader than 4/5  BIS central bankers' speeches  how many are employed and the level of economic activity. As Paul Allen, co-founder of Microsoft, explained: In my own philanthropy and business endeavors, I have seen the critical role that the arts play in stimulating creativity and in developing vital communities…the arts have a crucial impact on our economy and are an important catalyst for learning, discovery, and achievement in our country. Through the fiscal crisis, into the 1980s and to the present day, the city maintained its status as a center of culture and the arts.