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The 1987 Crash and the Spatial Incidence of Employment Changes in the New York Metropolitan Region

Author

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  • Joseph C. Cox

    (Canadian Imperial Bank of Commerce, Toronto, Ontario, Canada)

  • Valerie Preston

    (Institute for Social Research and Department of Geography, York University, 4700 Keele Street, North York, Ontario M3J 1P3, Canada)

  • Barney Warf

    (Department of Geography, Kent State University, Kent, OH, USA)

Abstract

Following the stock market crash on 19 October 1987, the securities industry contracted nation-wide. In New York City, over 10 800 jobs were lost within eight months of the crash. Bonuses, a major component of salaries in the industry, also declined. The short-run induced effects on regional output, employment and personal and business income were computed using an Input-Output model of metropolitan New York. Employment effects were decomposed by occupation, industry and county of residence. Output and total employment fell by $1.8bn and 28860 jobs, respectively. The incidence of increased unemployment was borne by clerical workers in the securities industry (primarily through the direct effects) and by service and unskilled sales staff in wholesale and retail trade (through the indirect and induced effects.) Manhattan and the adjacent inner ring counties were most affected.

Suggested Citation

  • Joseph C. Cox & Valerie Preston & Barney Warf, 1991. "The 1987 Crash and the Spatial Incidence of Employment Changes in the New York Metropolitan Region," Urban Studies, Urban Studies Journal Limited, vol. 28(3), pages 327-339, June.
    • Handle: RePEc:sae:urbstu:v:28:y:1991:i:3:p:327-339
    DOI: 10.1080/00420989120080381
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    References listed on IDEAS

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    1. Robert Aderhold & Christine M. Cumming & Alison Harwood, 1988. "International linkages among equities markets and the October 1987 market break," Quarterly Review, Federal Reserve Bank of New York, vol. 13(Sum), pages 34-46.
    2. Leland, Hayne & Rubinstein, Mark, 1988. "Comments on the Market Crash: Six Months After," Journal of Economic Perspectives, American Economic Association, vol. 2(3), pages 45-50, Summer.
    3. Paul Bennett & Jeanette Kelleher, 1988. "The international transmission of stock prices disruption in October 1987," Quarterly Review, Federal Reserve Bank of New York, vol. 13(Sum), pages 17-33.
    4. Gammill, James F, Jr & Marsh, Terry A, 1988. "Trading Activity and Price Behavior in the Stock and Stock Index Futures Markets in October 1987," Journal of Economic Perspectives, American Economic Association, vol. 2(3), pages 25-44, Summer.
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