The city may be home to the crossroads of the world, the Statue of Liberty and New York values, but its business roster is not quite as cosmopolitan, according to a new analysis.
An analysis slated to be released Monday by the Partnership for New York City, a consortium of business executives, notes that most of the foreign companies in the city hail from Europe.
As competition for foreign firms’ outposts and jobs hastens, the Partnership argues the government should do more to woo businesses from areas where markets are expanding in Asia, the Middle East and South America.
“There’s a much bigger opportunity for attracting foreign companies from high-growth regions of the world — Asia, South America, the Middle East — that we’re not taking advantage of,” said the Partnership’s president, Kathryn Wylde. “We should really pay attention to countries with a growing market demand for goods and services from New York, and one important way to do that is to have more of their companies have operations here.”
As it stands, the city has outposts of more than 5,000 businesses based abroad, which employ 298,000 people and collectively account for 11 percent of the city’s annual economic output, according to the Partnership’s report.
Jobs created over the past decade by foreign businesses have grown an average of 2 percent a year, which the report describes as relatively modest in the era of globalization.
It notes that Singapore and London have received more than the city in recent years in foreign direct investment, which does not include passive investments, such as putting money into a merger, real estate development or private equity.
The analysis found that European-based companies represent 78 percent of the city’s foreign direct investment. Retailers such as H&M, Zara and LVMH, the parent company of Sephora and Louis Vuitton, are making a substantial portion of this investment, according to the report.
Technology is the fastest growing sector of foreign direct investment, according to the report. And tech companies also seem to come from a wider array of nations, the analysis said.
Wylde said a “light concierge service” run by the government or an affiliated non-profit could help these sorts of companies get settled by informing them about real estate opportunities, trade associations and other resources.
“The big institutions can find their way around, but the opportunity we see is for earlier stage companies that really need some help in making a decision and finding their way through New York,” Wylde said.
Beyond general guidance, foreign companies that spoke to researchers repeatedly described the aging transit infrastructure as a top deterrent to their expansion, Wylde said.
“We’re encouraged that there’s a real focus on improving operations and reliability by Governor Cuomo and the new MTA leadership,” Wylde said. “On the other hand, there are a lot of big projects ahead — tunnels and signal systems and other things that are wearing out that are going to need a lot of investment. And we don’t yet know where that’s coming from.”