Unemployment, TRANSFORMING OUR BUSINESS CLIMATE, Labor
GSI Analysis: October ‘20 Jobs Report – NJ’s Recovery Stalls: Jobs Down, Unemployment Up
Unemployment climbs to 8.2% as state sheds 5,200 jobs
Atlantic County suffered highest job losses in the nation 2019-2020
Public workforce declines likely due to Census ending
Labor force recovers some of September’s massive decline
On November 19th, New Jersey’s Department of Labor and Workforce Development issued the monthly jobs report for October 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:
After a string of unprecedentedly strong gains, New Jersey’s labor market frayed in October. The job count fell 5,200, after rising 481,500 from April to September. Job losses in October were, however, concentrated in the public sector, which saw an 18,000 decline. The details of the government losses are not yet available, but certainly the end of temporary Census jobs played a part. In the private sector, the one area to see a noticeable loss was trade, transportation, and utilities. Raw figures actually showed an increase in this sector, but this was smaller than normal seasonal patterns projected, so the seasonally adjusted count was down.
Leisure and hospitality jobs grew by 5,700—a much smaller gain than in recent months. The resurgence of the pandemic, and recommendations that recreational travel be curtailed will likely hold down jobs in this sector in coming months. While leisure and hospitality is not that large a sector for New Jersey as a whole, compared to other states it is absolutely critical for some areas. This week the U.S. Bureau of Labor Statistics released definitive data on employment and wages for the second quarter by county. Atlantic County had the largest drop in the nation in jobs from the second quarter of 2019 to the second quarter of 2020 of any “large” county: 34.2%. This was obviously the effect of the spring shutdown of the county’s gaming industry (Atlantic County also had the distinction of being the top county for average wage gains: 22.5%. The concentration of job losses among low-wage workers artificially boosted average wages).
The household survey’s figures looked even gloomier than the job numbers: the state’s unemployment rate shot up from 6.7% in September to 8.2% in October. The extraordinary increase in unemployment occurred even though the number of New Jersey residents working rose by almost 16,000. Much more than offsetting the increase in employment was a remarkable 89,000 boost to the state’s labor force. October’s sharp labor force gain, though, made up for little more than one-third of September’s plunge of more than 250,000, which drove the force participation rate to a 44-year low of 61.4%.
The details muddle the full story: the rise in private sector jobs being offset by the government contraction; the unemployment rate increase resulting from the surge in the labor force (which could be a positive sign: people may be becoming more optimistic about finding jobs). However, the bottom line seems clear enough: the rather headlong recovery we had been seeing in our job market has been arrested (hopefully only briefly).