Unemployment, TRANSFORMING OUR BUSINESS CLIMATE, Labor
GSI Analysis: NJ Jobs Report – Re-building the Jet Engine while Flying the Plane
Caring for the health of residents, while planning our economic recovery is our top priority
Jobs are the “engine” of NJ’s economy generating revenue for our government & income for our families
Review of key sectors shows where we have opportunity
Industry leaders are equal partners with government
Today New Jersey’s Department of Labor and Workforce Development released the February 2020 jobs report, so we are providing a brief summary of that report with the balance of Garden State Initiative’s analysis being forward looking.
By far, the most difficult challenge today is caring for the physical health and safety of our residents. Every day we see those who are most able, from the public and private sectors, delivering those services both admirably and capably. For that we are all most grateful.
“Designing today how New Jersey bounces back economically is similarly a solemn responsibility. Leadership for that falls to those who are most able and they have the unenviable task of essentially re-building a jet engine while simultaneously flying the plane since the engine of our economy is jobs,” said GSI’s president Regina M. Egea. “Only jobs produce revenue for government and income for our families. Beginning first with where our jobs are today, and then planning how we restore those as quickly as possible, will best prepare us for that sooner-than-we-imagine day when we are ‘cleared for takeoff.'”
Utilizing February as a baseline, New Jersey’s economy added 3,100 jobs, with the state’s unemployment rate remaining unchanged at 3.8%. The state’s workforce stood at 4,564,200, with 4,243,900 residents employed on non-farm payrolls. As we all are expecting, the data for March, scheduled to be released in late April, will show a significant decline in New Jersey’s jobs.
Taking the longer view, the Leisure and Hospitality sector which includes hotels, restaurants and recreation, was a bright spot for New Jersey in 2019, when the state ranked 4th in job growth and ended the year with 382,000 jobs. There will be a measurable drop going forward with a possibly curtailed season at the Jersey Shore and the current full closure of the Atlantic City casino resorts but it certainly is one that has the potential to recover quickly as COVID-19 restrictions are removed.
There are other sectors, including the Financial Activities and Trade, Transportation and Utilities, which have been especially challenging for New Jersey in recent history. In 2019, the state ranked second in the U.S. for job losses in Financial Activities, trailing only New York in the sector, shedding 2,100 jobs in a sector that currently employs over 250,000 residents. In the Trade, Transportation and Utilities sector, an area which should be a strength due to our state’s geography and infrastructure, New Jersey ranked 29th in job growth, adding only 9,000 jobs during the year to a sector that employs nearly 900,000 residents. This remains a sector with tremendous growth potential for New Jersey.
Herein lies the opportunity for New Jersey: we can lead the nation in recovery, not suffer indefinitely from the wounds of COVID-19, if we explicitly design our “back to work” plan to maximize our strengths AND rely on a “quick start”. We cannot fix every problem at once, but we can prioritize what contributes the most to our total economy and aim to capture the most revenue growth as early as possible, and thus restore cash flow into these employers and get New Jersey “back to work”.
Focusing on the sectors with the largest employers in New Jersey (excluding Healthcare) is a great place to start: Biotech and Life Sciences, Transportation and Logistics, Food Processing, Software and Web-based Services, Financial Activities and Energy Device Manufacturing and Utilities.
Over the next 15 days, who is better equipped than New Jersey’s CEOs from these industries, in collaboration with decision makers from state and local government, to design our “back to work” plan starting right now? Who better understands how our economy works and how to get it back on its feet? This isn’t about politics, it’s about jobs. This isn’t about what will we do when we are “over” COVID-19, it’s about how we defeat COVID-19 with a clear-minded economic recovery that makes New Jersey stronger than we were before March 2020.
Just as each state governor aggressively demanded support from our federal government in the form of temporary hospitals, supplies for healthcare workers, and yes financial relief in order to “flatten the curve”, so too New Jersey’s industry leaders have the obligation to set out the requirements they need to get “back to work”. Absolutely there will be a financial component but it’s never just that. Business as usual will not suffice so there must be a willingness to adjust regulatory burdens, payment schedules and work rules to name a few.
Industry leaders who construct NJ’s “back to work” plan can begin by laying out the key decisions needed such as: From both state and local governments, what temporary relaxation of rules, reporting or other regulatory burdens are necessary for a “quick start”? From suppliers such as utilities, how do we extend payment terms over the next 6 months to ensure lights and heat remain on at workplaces? From teachers, will you extend school hours so parents can make up lost work hours without further expense to anyone? From residents, do we need to work half shifts or other novel work arrangements for the next 60-90 days with a promise to return full time afterwards?
If we are “all in this together” then we deserve thoughtful industry leaders to set out the plan, we expect our government to demonstrate they know how to govern thru a crisis, and most importantly, we know we have residents who care about each other as much as themselves.
Re-tooling our economic engine mid-flight sounds daring, but the alternative is much worse for everyone.