Unemployment, TRANSFORMING OUR BUSINESS CLIMATE
Center Square NJ: New Jersey unemployment falls to 7.6% as workers leave workforce
By Todd DeFeo
(The Center Square) – New Jersey’s unemployment rate fell by 2.6 percentage points to 7.6% in December, but officials say the drop is mainly due to residents leaving the labor force rather than finding a job.
According to numbers from the state Department of Labor & Workforce Development, in December, nonfarm wage and salary employment in New Jersey reached a seasonally adjusted level of nearly 3.9 million, a decrease of 7,700. Both the private (down 7,100) and public (down 600) sectors of the state’s economy saw job losses.
In a news release, the state agency said the Garden State regained about 58% of the jobs lost because of the COVID-19 pandemic, or 479,400 total jobs. Still, state officials said the data indicates the employment recovery from its “pandemic-related April low point” apparently stalled in the fourth quarter.
“New Jersey payrolls fell by 7,700 in December, bringing the job count down to a bit less than September’s level,” Charles Steindel, the state’s former chief economist and resident scholar at Ramapo College’s Anisfield School of Business, said in an analysis for the Garden State Initiative. “An 8,900 plunge in leisure and hospitality employment was the main factor behind the aggregate job loss.
“The upsurge in the virus surely played a large role in depressing activity in that sector, and one hopes as the supply and application of vaccines ramp up, this sector will revive,” Steindel added. “However, hiring in other sectors, with one exception, was at best lethargic, with most declining. The major exception was construction, with a strong gain of 3,100, obviously reflecting the upsurge in housing.”
According to the state Department of Labor & Workforce Development, 93,900 people dropped out of the state’s labor force.
In the analysis, Steindel said over the past four months, the state’s unemployment rate was “whipsawed by large erratic movements in the labor force,” including a drop of 250,000 in September.
“Our December job numbers were not materially out of line with the poor national results,” Steindel added. “Once again, we were at odds with the nation in our unemployment figures. New Jersey’s unemployment rate fell sharply to 7.6% – still higher than the national figure of 6.7%, but not markedly so.
“… On the whole, the December numbers do show that New Jersey’s job count has levelled off at around 350,000 under the early 2020 peak,” Steindel said. “The labor force and unemployment rate figures are hard to interpret, but it does seem that any signs of growth in the labor force that seemed evident in the middle of 2020 are gone.”