Queens diversity helped it weather downturn

Economic diversity helped insulate Queens from the worst of the recession, New York's top banker said Friday.

William Dudley, president of the Federal Reserve Bank of New York, said employment in Queens only fell by 3 percent from peak to trough because of the wide array of businesses, from air transport and manufacturing to retail and services. Employment fell 4.5 percent in New York City as a whole during the 2007-09 period, he said, and 7 percent nationwide.

"Queens' dynamic economy was hard-hit, yet it proved more resilient than Manhattan's and much of the nation's," he told about 120 business executives and politicians at a Flushing hotel.

Dudley also said the Queens workforce had stopped contracting in the first half of last year and now is probably enjoying "a sustained upturn."

He noted economic growth had slowed in New York City recently compared with that of the nation. But he said, "I would not be overly discouraged. After all, soft patches are not uncommon during economic recoveries."

Dudley's comments to the Queens Chamber of Commerce were part of a tour of regions served by the New York Fed, which encompasses New York State, Puerto Rico, the Virgin Islands and parts of New Jersey and Connecticut.

Asked whether there would be an easing of the credit crunch that's undercut some small businesses, Dudley said entrepreneurs would continue to have problems because many use credit cards and home equity loans to pay expenses. He is vice chairman of the interest-rate-setting Open Market Committee, which meets Tuesday.

Dudley's optimism about inflation being under control despite rising prices for food and gasoline was greeted with skepticism. One chamber member asked when was the last time Dudley shopped for groceries, which he didn't address.

"I certainly acknowledge that food prices have gone up," he said. "People also forget that other prices are going down . . . You can buy an iPad 2 that costs the same price as an iPad 1 [and] that's twice as powerful."

Dudley's reference to the iPad 2, which sells for $499 and up, caused some chamber members to shake their heads. One member muttered, "I can't eat an iPad."