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August 19, 2009
New Jersey's economy added 5,900 jobs in July, thanks to surprising strength in the private sector, in a sign that the recession might be easing, the state Department of Labor and Workforce Development reported Wednesday.
The figures were a 180-degree turn from the previous 17 months — and, apparently, from what the rest of the nation was reporting — leading economists to caution about jumping to conclusions.
"This is apparently good news. However, it's not time to pop the champagne corks yet," Rutgers University economist James W. Hughes said. "Last year, we had a substantial revision (after the initial figures were released). We need several months of positive data like this to establish a trend."
The jobs report showed the private sector added 13,000 jobs and the public sector lost 7,100 jobs, providing the first monthly gain since January 2008. The unemployment rate rose from 9.2 percent to 9.3 percent, its highest level since June 1977.
The report consists of a payroll survey of employers that tallies the number of jobs and a survey of workers that tallies the jobless rate. They don't always line up in the same direction, so economists tend to put more weight on the payroll survey, partly because it is larger.
Jeffrey Glickman, owner of Greenlawn Sprinkler in Freehold Township, said he couldn't tell if the economy is improving; contractors still have to fight hard for each job and discount their prices.
But, "the year is not as bad as I thought it would be, so I'm optimistic for next year," Glickman said.
Campaign fodder
The report was released during the heat of a gubernatorial election, and it came tinged with politics. Labor Commissioner David J. Socolow credited Gov. Jon S. Corzine's economic recovery initiatives for fostering job creation and helping restore confidence.
"New Jersey's private-sector employment is trending in the right direction," Socolow said. "New Jersey has laid the groundwork for a recovery marked by stronger job growth when the global recession ends."
Republican gubernatorial candidate Chris Christie had a different opinion: "A 9.3 percent rate is no reason to celebrate, especially when you look at the fact that some of our counties are suffering unemployment rates upwards of 10 percent, and the city of Camden is suffering with 18 percent unemployment.
"Gov. Corzine's policies have failed to create quality, sustainable jobs that will give New Jersey families security and stability," he said.
"It's certainly a positive sign if you have any turn to positive numbers to the job market," independent candidate Chris Daggett said. "I don't know if this is any signal whatsoever of a turnaround in the economy because people are still expressing concerns, great concerns."
Statistically speaking, New Jersey's labor market didn't grow as fast as the rest of the nation's did earlier in the decade. And it hasn't been hit as hard during the recession.
New Jersey has lost 150,100 jobs, or 3.7 percent of its work force, since the national recession began in December 2007. The nation has lost 6.7 million jobs, or 4.8 percent of its work force, during the same time, according to the state.
Corzine has touted legislation he signed in December that put $4 billion in road and school construction projects on the fast track and gave tax breaks to employers who expand their businesses, either by hiring workers or investing in buildings and equipment.
Meantime, New Jersey was expected to receive about $17.5 billion over three years from the federal government's economic stimulus package passed in February. How much that has aided the labor market may never be clear.
Where the jobs are
The state said several sectors added to their employment numbers in July. The leisure and hospitality sector added 6,200 jobs; the construction sector added 3,400 jobs; the professional and business services sector added 3,200 jobs; and the manufacturing sector added 3,100 jobs.
Trade, transportation and utilities, a segment that includes retailers, lost 4,500 jobs last month, according to the state.
Patrick J. O'Keefe, director of economic research for the accounting firm J.H. Cohn, said strong job growth could be far off. Consumers and businesses, weighed down by debt, aren't spending the money they have.
"All of those things suggest we are going to see a slow and gradual recovery from what's now the longest recession since the Great Depression," O'Keefe said.
The patience of some unemployed workers was tapped long ago. Grace Cascio of Brick lost her pharmacy technician job in January. Her husband, Louis, lost his automobile technician job in April. It has left them trying to get by on unemployment compensation that amounts to half their previous income.
They struggle to pay for health insurance and gasoline. They aren't sure how they will pay the $300 water bill that arrived. And now they are considering selling their house and moving to Florida.
"Our mortgage payment is almost $1,400 a month," said Grace Cascio, 47. "I can't do it. Not to mention all the other bills."
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