Unemployment, TRANSFORMING OUR BUSINESS CLIMATE, Labor
GSI Analysis: Dec. ’19 Jobs Report – Unemployment Driven Higher as More Residents Seek Work; Sustainability of Growth to be Proven in Months Ahead
Unemployment increases by 0.1% to 3.5%, 2nd monthly increase
Workforce grows by 23,300 individuals, 4th consecutive month of growth
GDP & Personal Income data sends mixed signal about our economic trajectory
Losses in Manufacturing & Construction defy strong U.S. growth
According to Garden State Initiative (GSI) analysis of the newest jobs numbers issued by the Bureau of Labor Statistics, more of New Jersey’s residents are seeking work which led to an uptick in our unemployment rate by 0.1% to 3.5%, matching the U.S. rate which was unchanged. The state reported an increase of 5,700 private sector jobs in December, while adding 800 public sector positions, for a net gain of 6,500. Of note, the state shed jobs in the Construction and Manufacturing sectors, which experienced strong growth nationally.
“Unlike 2018 which saw a series of up and down months in the state’s labor market, New Jersey closed the year on a strong note, with more residents deciding to enter the workforce,” stated GSI’s president Regina M. Egea. “Longer term, whether New Jersey will finally join in the ongoing national boom remains to be seen in these early months of 2020.”
As part of our analysis of last month’s release of personal income data, GSI illustrated that New Jersey’s income growth rate trailed the nation (2.9% vs. 3.9% ranking 42nd). More consistent with this month’s jobs data, our analysis of the most recent GDP data, highlighted that while the state had its best quarter since early 2018, that growth was fueled by gains in our nondurable manufacturers including industries such as pharma and refining, where New Jersey has seen limited growth in recent years. In contrast other sectors which are more likely keys to the state’s forward looking growth, such as professional services management, information, and finance, the state kept pace with the nation, rather than leading.
New Jersey’s workforce increased by 23,300 individuals in November, the fourth consecutive month of significant gains, exceeding the workforce size at the time of the Great Recession in 2008, but remaining below the 2010 average. The state’s Labor Force Participation Rate increased 0.4% to 64.0%, slightly ahead of the U.S. rate of 63.2%, which was unchanged.
Gains were recorded in four out of nine major private industry sectors, with gains led by Hospitality (+3,400) and Professional and Business Services (+2,700) sectors which also experienced strong growth on the national level. Losses were recorded in Construction (-600) Manufacturing (-500) sectors which defied the national economy adding 16,000 and 20,000 jobs in those respective sectors.