Gov. Andrew Cuomo’s plea to private sector companies to order all their employees back to workplaces and require vaccinations — even for shoppers and diners — met with a simple “not possible” Wednesday from most city business leaders.
Large employers don’t believe they can act without a government requirement. Small firms are having difficulty luring staff back as it is. And retailers and restaurateurs have little appetite for another rule to enforce.
“We require our staff to get vaccinated,” St. John Frizell, co-owner of Gage & Tollner, the 19th-century Brooklyn restaurant that recently returned after a 17-year hiatus, said Wednesday. “Currently, we’re not interested in requiring proof of vaccination from our customers.”
On Thursday, however, Frizell reversed course on customer vaccinations — another sign of a fast-changing landscape that has many business owners scrambling.
As part of a wide-ranging speech to the Association of Better New York unveiling his plans to deal with the rise of COVID-19 cases, the governor noted Wednesday that the city’s economic recovery is lagging the rest of the state. He focused on three issues: rising shootings, homelessness and high taxes.
In a move sure to raise eyebrows, Cuomo acted as if Eric Adams were already mayor, praising the Democratic candidate as a person “who gets it about what must be done.” Not once did he mention his nemesis, Mayor Bill de Blasio, who had made a similar plea to private companies Friday on WNYC’s Brian Lehrer show.
Cuomo, who said state employees must be vaccinated by Labor Day or be tested weekly, also suggested schools may have to take more aggressive actions in September if cases continue to increase as the Delta variant spreads, though he sidestepped any specifics.
De Blasio has mandated continued wearing of masks in city schools, and recently ordered all municipal employees — including educators — to get vaccinated or tested weekly.
But the most significant part of Cuomo’s presentation focused on the need for office workers to be back in Manhattan’s 500 million square feet of office space.
Only 24% of that office space was occupied the week of July 14 — less than any major city in the country, except for San Jose and San Francisco, according to data reported in the City Comptroller’s weekly economic newsletter. Meanwhile, Austin, Dallas and Houston are all approaching 50%.
“Say to your workforce, ‘By Labor Day, everyone is back to the office,’ Cuomo pleaded. “We need that volume to support the restaurants, the shops, the services.”
‘A Devastating Impact’
The governor pointed out that even a relatively small decline in economic activity due to remote work would have major consequences for small businesses that depend on those workers, as well as for the city and state tax revenues.
Contrary to popular belief, spending is not simply transferred to the city’s residential neighborhoods when people work from home: Pre-pandemic, almost 1 million people commuted from the suburbs each weekday, according to City Planning Department figures.
“If you were to see a 15% decline of people coming back to New York City, that would have a devastating impact,” he added.
A few companies are already following Cuomo’s advice. The Durst Organization announced Wednesday that any worker at its real estate organization not vaccinated by Labor Day will be fired. The owner of the massive Hudson Yards project, Related Cos., says in online employment ads that vaccinations are required.
Google, the city’s largest tech employer with some 10,000 workers here, said Wednesday it would mandate vaccinations for its workers, while pushing back its return to the office to mid-October from mid-December.
Wall Street banks like Goldman Sachs and Morgan Stanley have required disclosure of vaccination status.
Who Knows Who’s Vaccinated?
But most businesses say the government has to lead on the vaccination requirement — not defer to private companies. While the federal government has made it clear that it is legal to mandate vaccinations, a view reiterated this week by the Justice Department, that doesn’t cover everyone in town, some business leaders pointed out.
“Is everyone on the subway vaccinated?” said Kathryn Wylde, CEO of the big business group The Partnership for New York City. “And state borders are porous, so it is not enough to get New Yorkers vaccinated.”
The situation is particularly difficult for small businesses trying to get employees back to the workplace, said Randy Peers, president of the Brooklyn Chamber of Commerce.
“They don’t have the financial means to offer incentives to encourage vaccination and really don’t want to be in a position to require vaccinations,” he said.
However, he added, many business owners would welcome a government mandate that included vaccinations as part of the federal Centers for Disease Control’s guidance on safe working environments.
Restaurateurs feel the same way: Government should go first by allowing only vaccinated people in its buildings, said Robert Bookman, a lawyer for the NYC Hospitality Alliance.
The frustration of business leaders became evident after Cuomo’s speech when Bill Rudin, co-chair of Rudin Management Cos. and a long-time civic leader, told the governor that despite strenuous efforts, including talks with union leaders, only 50% of building workers were vaccinated.
Cuomo simply reiterated that as an employer Rudin could impose a vaccine requirement.
Call for ‘Workforce Investments’
Most business people agree with Cuomo’s objective, even if many want a government mandate.
“If we want to bring New York’s economy back to full throttle, we must ensure that our central business districts are fully populated with the office workers who fuel that economic engine,” said James Whalen, president of the Real Estate Board of New York.
“We cannot forget that small businesses throughout those corridors are relying on commuter foot traffic to continue thriving, covering expenses and employing their own workers, which ultimately generates critical tax revenue and economic activity,” he added.
Some economists don’t believe the return of office workers should be the priority. James Parrott of the New School says the major cause of the lagging recovery is the decline in tourism and business travel.
“The mayor and governor should be focused on the workforce investments to connect less-educated workers of color with better job opportunities and policies to raise compensation for child care and home care workers,” he said.