GSI Analysis: Philadelphia Fed Index Reinforces Picture of Weakening New Jersey Economy

• New Jersey’s index down at both one- and three-month horizons.
• Meager twelve-month rise of .2 percent smallest in the nation.
• Performances of neighboring and comparable states (Connecticut, Delaware and Pennsylvania) are noticeably better.

The Federal Reserve Bank of Philadelphia compiles monthly indexes of coincident economic activity for all 50 states. The measures are intended to indicate the aggregate trend of a state’s economy, and are based largely, but not entirely, on monthly job data. The report for September, released today, paints a disturbing picture of New Jersey’s situation.

The New Jersey index fell .21 percent from August to September, .60 percent from June to September. There was an increase of .20 percent from September 2022, but that was the smallest increase in the nation (Arkansas was the next smallest, at a touch more palatable .45 percent).

New Jersey’s softness may be more than a regional phenomenon. Connecticut, Delaware, and Pennsylvania’s numbers were all much stronger. New York had a small decline in September, but its gains over the last three and twelve months, while smaller than the nation, were clearly much better than ours. Furthermore, over the last twelve months, Maryland and Massachusetts, two states that are broadly comparable to us in size and income, reported the largest increases in the nation.

On the whole, this report adds to the marked rise in unemployment over the last year as indicating that trends in New Jersey have become rather unfavorable.

The Philadelphia Fed release can be found at https://www.philadelphiafed.org/-/media/frbp/assets/surveys-and-data/coincident/2023/coincidentindexes0923.pdf