For a lot of the final 20 years, together with throughout the pandemic, know-how corporations have been a vibrant spot in New York’s financial system, including hundreds of high-paying jobs and increasing into hundreds of thousands of sq. toes of workplace house.

Their development buoyed tax income, arrange New York as a reputable rival to the San Francisco Bay Area — and supplied jobs that helped the city absorb layoffs in different sectors throughout the pandemic and the 2008 monetary disaster.

Now, the know-how trade is pulling again arduous, clouding the town’s financial future.

Facing many enterprise challenges, massive know-how corporations have laid off greater than 386,000 employees nationwide since early 2022, based on layoffs.fyi, which tracks the tech trade. And they’ve pulled out of hundreds of thousands of sq. toes of workplace house due to these job cuts and the shift to working from dwelling.

That retrenchment has damage a number of tech hubs, and San Francisco has been hit the toughest with an workplace emptiness price of 25.6 %, based on Newmark Research.

New York is doing higher than San Francisco — Manhattan has a emptiness price of 13.5 % — however it could now not depend on the know-how trade for development. More than one-third of the roughly 22 million sq. toes of workplace house out there for sublet in Manhattan comes from know-how, promoting and media corporations, based on Newmark.

Consider Meta, which owns Facebook and Instagram. It is now unloading a giant chunk of the greater than 2.2 million sq. toes of office space it wolfed up in Manhattan lately after shedding round 1,700 workers this 12 months, or 1 / 4 of its New York State work pressure. The firm has opted to not renew leases overlaying 250,000 sq. toes in Hudson Yards and for 200,000 sq. toes on Park Avenue South.

Spotify is making an attempt to sublet 5 of the 16 flooring it leased six years in the past in 4 World Trade Center, and Roku is providing 1 / 4 of the 240,000 sq. toes it had taken in Times Square simply final 12 months. Twitter, Microsoft and different know-how corporations are additionally making an attempt to sublease undesirable house.

“The tech companies were such a big part of the real estate landscape during the last five years,” stated Ruth Colp-Haber, the chief govt of Wharton Property Advisors, an actual property brokerage. “And now that they seem to be cutting back, the question is: Who is going to replace them?”

Ms. Colp-Haber stated it might take months for greater areas or total flooring of buildings to be sublet. The great amount of house out there for sublet can also be driving down the rents that landlords are capable of get on new leases.

“They are going to undercut every landlord out there in terms of pricing, and they have really nice spaces that are already all built out,” she stated, referring to the tech corporations.

The tech sector has been a driver of New York’s financial system for the reason that late-90s dot-com growth helped to ascertain “Silicon Alley” south of Midtown. Then, after the monetary disaster, the growth of corporations like Google supported the financial system when banks, insurers and different monetary corporations have been in retreat.

Small and huge tech corporations added 43,430 jobs in New York within the 5 years by the tip of 2021, a 33 % achieve, based on the state comptroller. And these jobs paid very nicely: The common tech wage in 2021 was $228,620, practically double the typical private-sector wage within the metropolis, based on the comptroller.

The development in jobs fueled demand for business house, and tech, promoting and media corporations accounted for practically 1 / 4 of the brand new workplace leases signed in Manhattan lately, based on Newmark.

Microsoft and Spotify declined to remark about their resolution to sublet house. Twitter and Roku didn’t reply to requests for remark. Meta stated in a press release that it was “committed to distributed work” and was “continuously refining” its strategy.

A couple of huge tech corporations are nonetheless increasing in New York.

Google plans to open St. John’s Terminal, a big workplace close to the Hudson River in Lower Manhattan, early subsequent 12 months. Including the terminal, Google will personal or lease round seven million sq. toes of workplace house in New York, up from roughly six million right now, based on an organization consultant. (Google leases multiple million sq. toes of that house to different tenants.) The firm has greater than 12,000 workers within the New York space, up from over 10,000 in 2019.

Amazon, which in 2019 canceled plans to construct a big campus in Queens after native politicians objected to the incentives supplied to the corporate, has nonetheless added 200,000 sq. toes of workplace house in New York, Jersey City and Newark since 2019. The firm can have added roughly 550,000 sq. toes of workplace house later this summer season, when it opens 424 Fifth Avenue, the previous Lord & Taylor division retailer, which it purchased in 2020 for $1.15 billion.

“New York provides a fantastic, diverse talent pool, and we’re proud of the thousands of jobs we’ve created in the city and state over the past 10 years across both our corporate and operations functions,” Holly Sullivan, vice chairman of worldwide financial improvement at Amazon, stated in a press release.

And although many tech corporations proceed to let workers work at home for a lot of the week, they’re additionally making an attempt to woo employees again to the workplace, which might assist scale back the necessity to sublet house.

Salesforce, a software program firm that has places of work in a tower subsequent to Bryant Park, stated it was not contemplating subletting its New York house.

“Currently I’m facing the opposite problem in the tower in New York,” stated Relina Bulchandani, head of actual property for Salesforce. “There has been a concerted effort to continue to grow the right roles in New York because we have a very high customer base in New York.”

New York is and can stay a vibrant dwelling for know-how corporations, trade representatives stated.

“I have not heard of a single tech company leaving, and that matters,” stated Julie Samuels, the president of TECH:NYC, an trade affiliation. “If anything, we are seeing less of a contraction in New York among tech leases than they are seeing in other large cities.”

Fred Wilson, a associate at Union Square Ventures, stated tech executives now felt much less of a must be in Silicon Valley, a shift that he stated had benefited New York. “We have more company C.E.O.s and more company founders in New York today than we did before the pandemic,” Mr. Wilson stated, referring to the businesses his agency has invested in.

David Falk, the president of the New York tristate area for Newmark, stated, “We are right now working on several transactions with smaller, young tech firms that are looking to take sublet space.”

Many corporations are nonetheless pulling again, nevertheless.

In 2017 and 2019, Spotify, which is predicated in Stockholm, signed leases totaling greater than 564,000 sq. toes of house at 4 World Trade Center, changing into one of many largest tenants there. It quickly had an area with all of the accouterments you’ll anticipate at a tech agency — brightly coloured versatile work areas, eye-popping views and Ping-Pong tables.

But in January, Spotify stated it was shedding 600 people, or about 6 % of its world work pressure. The firm, which permits workers to decide on between working absolutely remotely or on a hybrid schedule, can also be decreasing its workplace house, placing 5 flooring up for sublet.

“On days when I’m by myself, I end up sitting in a meeting room all day for focus time,” stated Dayna Tran, a Spotify worker who repeatedly works on the downtown workplace, including that the workers who are available in encourage themselves and create group by collaborating on an workplace playlist.