DiNapoli Report Shows How NYC's Business Costs Compare to Other Major Metropolitan Areas

New York City remains one of the nation’s most expensive places to start or operate a business, but several major business expenses have grown at a slower rate than in competing metropolitan areas over the past decade, according to a new report released today by State Comptroller Thomas P. DiNapoli.

“New York City remains one of the world’s premier places to do business because of its unmatched talent, innovation and access to customers,” DiNapoli said.  “While operating here remains expensive, this report shows that some core businesses costs have grown more slowly than in many competing regions.  Understanding where costs are rising more quickly can help inform policies that support both economic growth and affordability.”

Several of New York City’s largest business expenses have grown more slowly than national averages and many competing metropolitan areas over the past decade, including:

• Private-sector wages.  Average private-sector pay reached $129,030 in 2025, among the highest in the nation, but inflation-adjusted wage growth trailed the national average over the last decade.
• Office rents.  Manhattan office rents remain the highest in the country but rent growth has been modest compared with many competing markets.
• Employee benefits.  Employer spending on health insurance, retirement benefits and paid leave remains above the national average, but growth in those costs has been lower than nationwide trends.

At the same time, several business costs in New York City continue to outpace national trends and pose significant challenges for employers, including:

• Electricity costs.  Commercial electricity rates in the city substantially exceed national averages and have risen faster than nationwide rates.
• Health insurance costs.  Health insurance remains one of the fastest-growing expenses facing employers and has increased more rapidly in the Northeast than nationally.
• Natural gas costs.  Commercial natural gas costs have surged over the past decade, with some business customers seeing costs more than double since 2017.
• Business taxes.  City businesses face the nation’s highest nominal combined corporate tax rate.

The report underscores the need for policymakers to better understand the factors driving business costs and competitiveness in New York City.  While the city’s access to talent, capital, and customers remains a significant advantage, addressing rising energy, health care and tax costs could help ensure businesses of all sizes can continue to grow, invest and create jobs in the five boroughs.  Recent efforts to reform regulations at both the state and city levels are steps in the right direction; but continued engagement with businesses and other stakeholders will be key to building on that progress across the five boroughs.

Report

The Cost of Doing Business in New York City

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