The state Department of Labor and Workforce Development released its January jobs report March 13, showing a continued positive labor trend to start 2023 as well as revised 2022 figures that give greater insight to the state labor market’s pandemic recovery.
According to the data, the new year kicked off with a strong January, as New Jersey employers increased payrolls by 24,200, with the private sector accounting for 90% of that growth.
“This was the fourth time in the last 12 months that there was a gain of more than 20,000 jobs,” said Charles Steindel, former chief economist of the State of New Jersey, who analyzed the report for the Garden State Initiative. “The only notable sector to see a decline was professional and business services, and that drop was the result of losses in support areas.”
In January, seven of the nine major private industry sectors recorded month-over-month job growth, headlined by leisure and hospitality (+9,400), education and health services (+6,800), construction (+4,000), and manufacturing (+3,300).
“Leisure and hospitality had a marked increase of 9,400, but the total job count in that sector is still slightly below the pre-pandemic peak,” Steindel explained. “Construction employment, which had been sluggish through most of 2022, saw a gain of 4,000 to set a new peak (the pre-recession peak had been exceeded a few times last year). It’s possible that the unusually mild winter weather affected these sectors: helping leisure and hospitality and construction, but leading to a drop in some business support activities, such as snow removal.”
Steindel also pointed out that New Jersey’s robust January showing was the fifth largest increase in the nation, only exceeded by California, Texas, Florida and New York.
The state unemployment rate ticked up from 3.3% to 3.4%, slightly below the national average of 3.6%.
“The increase in unemployment can be accounted for by a strong increase in the state’s labor force (more than 14,000) exceeding a 7,700 gain in the number of employed state residents,” said Steindel. “Our unemployment rate remains well below those of New York, Pennsylvania, and Delaware, and Maryland remains the closest state with a lower rate (3%).”
In fact, the labor force participation rate in January was 64.3%, the same rate recorded in the pre-pandemic month of February 2020.
The January jobs report was accompanied by benchmark revisions from the Bureau of Labor Statistics (BLS).
The December 2021 to December 2022 period was revised to a gain of 129,700, a smaller increase from the previously reported gain of 148,900. But, the revisions also found that the two-year job gain now stands at 395,300, representing 34,000 more jobs than originally anticipated.
“There were notable increases in the estimates of New Jersey’s monthly job counts in 2022, ranging from about 20,000 to 50,000, and averaging a bit over 37,000,” said Steindel. “The new data shows that New Jersey had recovered all the jobs lost to the pandemic by February 2022, several months earlier than previously thought.”
The average unemployment rate for New Jersey for 2022 was 3.7%, a decline from 6.6% in 2021.
The next look at whether the momentum will continue comes when the February jobs report is released March 23.s