- Unemployment rate drops to 4.4%; employment and labor force both gain.
- Very large, widespread, loss of 25,600 jobs.
The monthly labor market report contains data from two surveys, that of households (used to measure the unemployment rate and labor force), and that of employers (used to measure the number of jobs in the state). The two almost always differ somewhat, but rarely as much as in the latest release.
The good news first: the household survey reports the seventh straight drop in New Jersey’s unemployment rate. July’s rate was 4.4%, compared to June’s 4.5%. The total decline since December has been a full percentage point. The unemployment rate decline in July was due to a pretty marked increase of 9,180 in the number of state residents at work; this more than offset a 2,453 rise In New Jersey’s labor force ( an increase in the labor force is usually considered a positive sign—more people may be looking for work since the odds of getting a job might be up).
The jobs numbers were 180 degrees different. The job count in July was a massive 25,600 lower than in June (and the June number was revised down a large 5,200), bringing the number of jobs in the state back to near the level of two years ago. Except for the pandemic, this is the largest one-month decline since October 1990. Job losses were widespread, but the two hit hardest were professional and business services (down 13,400) and leisure and hospitality (down 7,300). The not-seasonally-adjusted numbers show that employers in administrative support and restaurants cut jobs, which seems quite odd for the summer months. Seasonal-adjustment factors suggest there is normally little change or some gain from June to July in the broad professional and leisure and hospitality sectors. On the whole, New Jersey’s job report seems like a worse version of the very soft national one.
Of course, today’s job numbers are preliminary, and could be revised substantially in the future. Nonetheless, they are disquieting. The normal tendency is to place a bit more reliance on the job data than the household employment count (the former is based on a much larger sample). The unemployment rate drop, then, should at the moment be seen as little more than a bit of solace.
