Unemployment Rate Rises Above 4% in New Jersey

Unemployment Rate Rises Above 4% in New Jersey 1098 638 Morris County Economic Development Corporation (MCEDC)

Unemployment Rate Rises Above 4% in New Jersey


“New Jersey’s unemployment numbers are very concerning,” Charles Steindel, former state chief economist, said in his analysis of the August jobs report for the Garden State Initiative. “The uptrend in the state’s unemployment rate continued in August, with it rising to 4.2% from July’s 3.9%.”

Over the past year, New Jersey’s unemployment rate has moved from well below the nation’s average, Steindel noted, to somewhat higher than that figure, which is currently at 3.8%. In last month’s State Employment and Unemployment report from the U.S. Bureau of Labor Statistics, New Jersey ranked 44th in the nation. The next report comes out Friday.

Overall, August was a bit of a mixed bag for the Garden State – the rising unemployment rate notwithstanding, which the state Department of Labor & Workforce Development attributes to more residents joining the labor force and fewer being employed.

Last month, the state gained 12,300 jobs with 6,700 coming in the private sector and 5,600 in the public sector, especially at the local level.

“The headline August number for job gains in New Jersey was higher than any month since January,” said Steindel. “The sectoral increases in August were widespread with the only declines reported to have been in construction (down 400) and trade, transportation, and utilities (also down 400).

“Once again, the public sector led the way, with a 5,600 increase,” he continued. “So, the numbers tell us that public sector employment has grown by 9,600 over the last two months which may be viewed with some skepticism.”

Unemployment rate rises above 4% in New Jersey
NJ July 2023 Report Jobs

There was also a major downward revision of 5,200 jobs in July, which now shows a loss of 4,200 instead of the previously reported slight gain of 1,000 jobs.

“The downward revision was primarily in the government sector, which had initially been reported to have had an extraordinary increase of 8,300. That number has been trimmed to 4,000, which is still quite large,” Steindel noted.

He also pointed back to that skepticism about these dramatic public sector gains, wondering whether they would hold up – or be revised, as well.

“Before seasonal adjustment, the estimate actually is that public sector employment in August was roughly 35,000 less than in June. What happens in the summer months, of course, is that public sector employees are laid off at the end of the school year and then brought back on payroll when schools reopen,” Steindel explained. “The precise timing is hard to predict and could be very different than what is assumed in the seasonal adjustment process. It seems safe now to assume that either the August gain will be revised away, or September will see a marked drop in public sector employment.”

The September report comes out Oct. 19.

Article courtesy of NJBIZ.