GSI: October ’21 NJ Jobs Report: Job Recovery Continues as Unemployment Falls Further Behind the Nation

October ’21 NJ Jobs Report: Job Recovery Continues as Unemployment Falls Further Behind the Nation

 

  • State adds 20,000 jobs, remains 200,000 below pre-pandemic level
  • NJ’s 7.0% Unemployment Rate is 2.4% higher than U.S. average, which fell .2% to 4.6%
  • Despite recent gains, Leisure & Hospitality remain 20% below pre-pandemic
  • Workforce remains 140,700 smaller than February ‘20
  • Distinct differences in jobs recovery among NJ’s regions

 

Morristown, NJ – On November 18th, New Jersey’s Department of Labor and Workforce Development issued the monthly jobs report for October 2021. Dr. Charles Steindel, former Chief Economist of the State of New Jersey, analyzed the report for the Garden State Initiative:

 

New Jersey employers added a net 20,000 jobs in October (22,000 in the private sector). This was the sixth straight month seeing a job increase of 17,000 or higher—an unprecedented streak.  But the recent gains need to be balanced against the losses during the pandemic. New Jersey’s job count is still a bit more than 200,000 under the February 2020 peak.  Job growth will need to continue at the recent fairly brisk pace for some time to get back there, even taking into account the likelihood that there will be a significant upward revision in the numbers in March.

 

The job gains were broad-based across private-sector industries. Professional and business services led the way, with an increase of 8,900 (much of this gain appears to be in support services, such as janitorial and landscaping). Leisure and hospitality added another 3,200, though that sector is still about 75,000 jobs (close to 20%) under its pre-pandemic peak. The other private sector with a very large gap remaining (close to 45,000) is educational and health services. The 300 jobs increase in that area in October was miniscule in both absolute terms and relative to that gap. One sector which has improved noticeably recently is construction, which added another 2,700 jobs in October and has more than reversed a drop seen in the first half of the year.

 

The numbers on the labor force, household employment, and the unemployment rate continue to be at odds with the job figures. There were some moderate gains in October in both the labor force and household employment, but both fell considerably shy of the payroll increase. New Jersey’s workforce remains 147,700 smaller than pre-pandemic levels. The unemployment rate ticked down to 7.0%, which means New Jersey’s gap with the national number (4.6%) has widened even more.

 

Employment Developments Within the State

 

It’s customary to say that South Jersey’s economy is in poorer shape than the North. When looking at numbers such as average income that’s certainly the case. To look at the extremes, average personal income in 2019 in Cumberland County was just over $41,000, while it was nearly $110,000 in Somerset County. But if we look at the labor market data, it seems that North Jersey has a greater way to go to return to pre-pandemic conditions than parts of the South.

 

Monthly numbers on the labor market are collected for the state’s metropolitan areas. Since these are not seasonally adjusted we can’t sensibly compare the latest numbers, which are from September (the local numbers come out later than the state-wide figures) with those from early 2020. We can, though, reasonably compare September 2021 with September 2019, which was a few months prior to the start of the pandemic.

 

Let’s start with the number of jobs. State-wide, the number of jobs in September 2021 was 4.6% less than in September 2019 (using the September numbers revised with the October state release). North Jersey has been trailing both the rest of the state as well as the nation (where jobs in September 2021 were 2.5% under September 2019). The Bergen-Hudson-Passaic area was down 7.3% over that period. The Newark area (which includes Essex, Union, and Morris counties, and extends west to take in Pike County, Pennsylvania) was down 5.9%. When we look south the situation is quite different. The Atlantic City metro area has a very long way to go to get back to pre-recession levels, with the number of jobs in September 2021 8.4% fewer than in September 2019. That’s hardly a surprise, given the critical importance of gaming to that area, and full casino reopenings just getting started in the spring. The rest of the region looks quite different. The job count in the Vineland-Bridgeton metro area (Cumberland County) was 3.0% lower in September 2021 than in September 2019; the comparable figure for the Camden division (Burlington, Camden, and Gloucester Counties) was -2.6%; that for the Trenton metro area (Mercer County) was -2.5%, while Ocean City (Cape May County) had 3.0% more jobs in September 2021 than in September 2019.

 

The unemployment rates for the various regions don’t tell the same tale. Trenton’s was unusually low in September 2021 (5.0%, vs. the 6.3% not-seasonally-adjusted figure for the state as a whole) while Atlantic City was at a quite high 8.9%.  The 7.5% rate in Vineland-Bridgeton was also noticeably higher than the state as a whole. But unemployment rates are affected by trends in the labor force. The state’s labor force dropped 3.0% over the two years ending in September; except for Atlantic City’s 4.3% decline (where the casino closings obviously made for a very bleak job picture, and surely drove many out of the labor force), the labor force counts fell less than that in the southern areas. Indeed, Ocean City saw a 3.0% increase. The somewhat stronger labor force growth would have been a factor keeping unemployment high—not necessarily a negative.

 

Why has the labor market situation in South Jersey been (relatively) better than in the North? There’s no obvious smoking gun. In the Trenton area, though, state government employment has been growing fairly steadily—in contrast to the state as a whole, where state government jobs (which include those in public colleges and universities) have been flat or drifting down. Of course, in September 2021 many of those state workers employed in a Trenton office were still working from home, quite a few outside of Mercer County. While we don’t have a complete answer, seeing some (relatively) good numbers in parts of the state that have long been troubled may be a hopeful sign.

 

-end-

 

The Garden State Initiative is a 501(c)3 nonprofit organization dedicated to strengthening New Jersey by providing an alternative voice and commonsense policy solutions in the state — solutions that promote new investment, the growth of businesses, the creation of economic opportunities, and innovation to the benefit of all New Jerseyans.

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