Unemployment, TRANSFORMING OUR BUSINESS CLIMATE, Labor
GSI Analysis: July ’20 Jobs Report – Unemployment Rate Holding above US Average as Continued Ban on Indoor Dining Ban Thrashes Hospitality Sector
Unemployment Rate 3.5% Above U.S. Average
Since April NJ regained 341K jobs, less than half of 831K jobs lost Feb. to April
Indoor Dining Ban Keeps Hospitality Sector at 2/3 of 2019 employment
Leisure and Hospitality led July gains, aided by Atlantic City re-opening
On August 20th, New Jersey’s Department of Labor and Workforce Development issued the monthly jobs report for July 2020. Dr. Charles Steindel, former Chief Economist of the State of New Jersey and current Resident Scholar, Anisfield School of Business at Ramapo College, analyzed the report for the Garden State Initiative:
July saw job gains in New Jersey, but we remain far from recovery. There was a net gain of 129,900 jobs, which set a new record, following June’s increase of 122,500 (revised down from the initial 130,900 figure). Since April New Jersey has regained 341,300—however, that is still less than half of the staggering 831,300 jobs lost from February to April.
Every major private sector saw job gains in July, though once again leisure and hospitality led the advance, with a pickup of 46,800—the reopening of the Atlantic City casinos was surely an important contributor to that. Nonetheless, it clearly is a weak summer at the Shore—the job count for leisure and hospitality is only two-thirds of what it was in July 2019. On a regional basis, New Jersey’s leisure and hospitality sector was especially hard-hit this spring, losing nearly two-thirds of its jobs. This was comparable to New York’s loss, but larger than other states in the area, such as Connecticut, Pennsylvania, and Delaware. Of note, those states are among the 47 states in the U.S. that have resumed indoor dining, while New Jersey, New Mexico and California have complete bans still in place.
In other sectors, trade and transportation also saw large gains. Even finance, an area where New Jersey has been doing poorly, picked up 2,300 jobs. Government employment is reported to have fallen 16,800, but this was probably the effect of the temporary state worker furloughs bunched into July, rather than a true cut in head count.
The numbers on unemployment and the workforce were also good. The unemployment rate fell 3 points to 13.8 percent, and there was a strong gain of 150,600 in the number of state residents working (furloughed state workers would be seen as “employed” in this count). While the drop in unemployment was record-setting, New Jersey’s jobless rate is still more than 3.5% points higher than the nation. The labor force moved up 13,200 in July, and has risen 75,700 over the past year, but is about 35,000 less than the all-time peak of the fall of 2012.
It’s likely that job growth here and nationwide will be slowing in the upcoming months. Certainly, with restaurants still closed to indoor service, and concerns over travel continuing, the rebound in leisure and hospitality will ebb. National retail sales gains have moderated, putting some further pressure on the entire trade and transportation sector. New Jersey government employment could pick up briefly with the end of the furlough cycle, but budget problems could hit that sector over the longer term. Basically, a sustained national recovery, along, of course, with an end to the pandemic, is essential to regain all the jobs that have been lost and bring unemployment back down. Our local policies should be geared to reinforcing that when it gets underway.