Listen to this article

New Jersey’s labor market showed signs of improvement in March, with the state adding 5,800 jobs and the unemployment rate falling to 4.9%, according to preliminary data from the U.S. Bureau of Labor Statistics.

The drop from 5.1% in February marks the first time the state’s unemployment rate has dipped below 5% since January 2025, though it still remains above the national rate of 4.3%.

Job gains were relatively broad-based, with six of nine private sectors adding positions:

• Professional and business services +3,300
• Private education and health services +3,200
• Leisure and hospitality +1,100
• Construction +800
• Information +800
• Trade, transportation and utilities +700

Concentrated losses appeared in:

• Other services -1,900
• Financial activities -1,400
• Manufacturing -400

Meanwhile, the public sector shed 300 jobs.

New data also February’s losses downward, with the state now estimated to have lost 8,200 jobs that month instead of the initially reported 10,300.

Cautious optimism

In his analysis for the Garden State Initiative, former chief economist for New Jersey Charles Steindel said the latest data show improvement — but cautioned against overreading a single month. “The news on New Jersey’s labor market was rather better in March,” said Steindel.

At the same time, he pointed to underlying weakness in the state’s longer-term performance.

“Taken in isolation, the March report doesn’t look bad,” he explained. “However, taking a longer look, the state’s job market looks fairly anemic: the number of jobs in March 2025 was only 4,000 higher than in March 2024. That poor performance was skewed by a drop in government jobs, but the private sector increase of 9,300 was not impressive, amounting to a gain of less than one-third of 1%.”

Steindel also noted a shrinking labor force, rather than robust hiring, partly drove the decline in unemployment. “While most of the drop in unemployment in March was due to a decline in the labor force, the number of residents at work was estimated to have increased by a bit more than 2,000,” he said.

Overall, while March’s gains helped offset February’s losses and brought the unemployment rate below 5%. The data suggest a stabilizing labor market, but one that still lacks strong momentum.