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Economic outlook grim for Queens in ’09

Queens is reeling. Rising unemployment rates, falling home sales, a skyrocketing number of foreclosures and sagging retail sales paint a grim picture of how the borough is being affected by the national recession, according to a sobering parade of statistics from both the public and private sectors.

And while government officials from Mayor Michael Bloomberg to newly minted President Barack Obama push for an economic stimulus package to snap the United States out of a year−long recession, many believe things are primed to get worse before they get better.

The situation has reached such dire straits that borough institutions like the Queens Botanical Garden and the Queens Zoo face the potential of losing all of their state funding in a budget proposed by Gov. David Paterson last month.

“Our financial advisers told us this is the perfect financial storm,” Queens Botanical Garden Executive Director Susan Lacerte said. “We closed the garden for two weeks, I had to make some layoffs, we’re not going to have spring hiring, we’re going to start closing the garden early. It’s like a changing paradigm. People say it’s the worst since the [19]30s, I feel it.”

State Labor Department Analyst James Brown said as Wall Street staggers, so too will the outer boroughs. According to department statistics, Queens lost nearly 10,000 jobs from November to December, bringing the borough’s unemployment rate to 6.4 percent, and Brown said January is not likely to be any different.

“Our system actually crashed twice on the first Monday in January because of the amount of unemployment claims that came in. So we’re expecting the numbers to be pretty grim in January as well,” Brown said.

Brown said although a large contingent of Queens workers does travel to Manhattan, the borough’s work force has also been hurt because its three largest industries — airlines, construction and health care — have also been suffering.

“Queens since it has the two airports has a disproportionate amount of wholesale traffic, so when the airline industry does poorly, so does Queens. The construction industry has also been very weak during the last few months,” Brown said. “We did not see a significant drop in the health care industry, but it’s not showing a significant strength either. Overall, the sector has done well, but there have been issues with individual hospitals.”

The health care outlook for Queens has been clouded in recent weeks with Caritas Health Care System, which operates both St. John’s Hospital in Elmhurst and Mary Immaculate Hospital in Jamaica, close to bankruptcy. About 2,500 jobs are hanging in the balance as officials scramble behind the scenes to find a solution.

The housing market in Queens also showed signs of substantial weakening during 2008. According to a report released last week by Prudential Douglas Elliman, Queens home sales fell by more than 39 percent in the last quarter of 2008 when compared to the same time period a year earlier. The report also said the average home sale price declined, dropping from $466,626 in 2007 to $419,153 last year — a difference of more than 10 percent.

And while housing prices faltered, foreclosure rates in Queens far outpaced the rest of the city. According to PropertyShark.com, a New York City real estate research group, Queens had 2,226 new foreclosures in 2008, an increase of more than 55 percent over 2007 levels.

Predictably, retailers across the borough have also suffered. Empty storefronts are becoming increasingly common along some of the borough’s busiest shopping strips, including Jamaica Avenue in Jamaica, Bell Boulevard in Bayside and Austin Street in Forest Hills.

And several business owners told the TimesLedger Newspapers that keeping their doors open is becoming more and more difficult.

“We are surviving, but many of the stores are just on the border of surviving,” said Paul Chan, owner of Embassy One Hour Photo, located at the intersection of 72nd Road and Austin Street.

“It’s really bad,” said Manzi Rai, owner of Rani Ayurvedic Spa and Lifestyle on Bell Boulevard. “We’ve had trouble paying our rent. When we opened, we had a lot of people coming in, but not as much now.”

The recession has also hit Queens’ nonprofit sector hard. Both the city and state are currently facing multibillion−dollar deficits, and several nonprofit organizations primarily funded by the government are struggling to get by and potentially facing closure.

But at City Hall Sunday, Bloomberg said some help may be on the way. Flanked by U.S. Sen. Charles Schumer (D−N.Y.) and U.S. Rep. Charles Rangel (D−Astoria), Bloomberg said he had secured more than $3.4 billion in funding for the city in President Barack Obama’s planned economic stimulus package, which should come up for a vote in the next few weeks.

“We can’t expect to discover silver bullet solutions, just like we can’t expect Washington to solve all our problems,” Bloomberg said. “But while this package won’t solve all of our New York City’s budget problems, it certainly will help a lot.”

In the meantime, however, leaders of city cultural organizations, like the Queens Botanical Gardens, are facing tough choices.

The staff they understand,” said Lacerte, who has already laid off two full−time employees. “But what happens is people wonder who’s next”

Reporters Nathan Duke, Anna Gustafson, Ivan Pereira and Jeremy Walsh contributed to this article.

Reach reporter Stephen Stirling by e−mail at sstirling@timesledger.com or by phone at 718−229−0300, Ext. 138.

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