Unemployment
GSI Analysis: Mixed Results for New Jersey’s August Labor Market
September 18, 2025
- Unemployment rate hits 5 percent for the first time in 3 ½ years; employment and the labor force keep moving down.
- Moderate job growth for a second straight month.
- New Jersey’s 5% unemployment rate remains notably above the nation’s 4.3%.
New Jersey’s unemployment rate moved up from 4.9 percent in July to 5 percent in August. This is the first time since the start of 2022 that the state’s rate was 5 percent or higher. Moreover, New Jersey’s rate has been higher than the nation’s for every month starting December 2022 (after a very short spell of our rate being lower).
The data show ongoing declines in both the labor force and employment of state residents; the recent rise in the unemployment rate reflects employment falling more than the labor force. August was the fourth straight month to see a drop in the labor force, while employment has fallen every month this year—August’s level was more than 46,000, or about 1 percent, lower than December’s.
The job numbers were considerably better. August saw a 4,900 increase (7,000) in the private sector, following a slightly revised down gain of 6,400 in July. These increases, though, do not yet offset June’s sharp loss of 14,400 jobs, and the number of jobs in August were slightly under December’ level.
Job changes by sector were mixed in August. Construction, finance, and government all lost more than 1,000 jobs, but professional and business services shot up by 7,300 (apparently mainly in support areas), while education and health services and leisure and hospitality both rose more than 1,000.
The national numbers are showing softening in the labor market, and New Jersey is no exception. However, while the Bureau of Labor Statistics reported that the national job count has been recently overstated, the same does not appear to be the case here—indeed, it’s possible the number of jobs in the state could be higher than we have been seeing. However, we won’t know if that is true until revised numbers are released next March.
