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In his analysis of the latest jobs report for Garden State Initiative, former New Jersey chief economist Charles Steindel said that “July was a poor month for New Jersey’s labor market.”

The total job count rose by just 1,000 last month, driven by an increase of 8,400 in the public sector while private sector employment sharply dipped by 7,400 jobs.

“While construction jobs rose 2,400, and education and health gained 2,100, the results in other sectors were dismal, with professional and business services down 5,400 and leisure and hospitality – which had not reached its pre-pandemic peak – down 5,300,” Steindel explained.

In July, the unemployment rate jumped from 3.7% to 3.9%.

“It seems quite possible that the difference from the national rate of 3.5% will be judged to be statistically significant,” said Steindel, noting that the U.S. Bureau of Labor Statistics is issuing its monthly State Employment and Unemployment report Aug. 18. “Most of the increase in unemployment reflects another noticeable gain in the labor force – 7,400, which was, however, noticeably smaller than any month in the first half of the year – only trivially offset by a very small increase of 900 in the number of state residents at work.”

In its jobs report, the state attributes the unemployment uptick to that increased labor force participation, noting that last month the state’s labor force participation rate reached 65.5% — it’s highest level since March 2013.

However, this marks the second consecutive lackluster jobs report for New Jersey, following a sluggish one in June that, it turns out, is even more disappointing than first thought.

“Adding to the glum news, the job figure for June was revised down by 4,200,” said Steindel. “The downward revision was almost entirely in professional and business services.”

Steindel noted that while national numbers have recently shown job growth slowdowns, that deceleration has been more marked here in the Garden State.

“To be sure, it’s difficult to adjust for normal seasonal movements in employment during the summer months, and that problem could be worse here than in some other parts of the nation,” said Steindel. “For instance, before seasonal adjustment, leisure and hospitality jobs rose 2,400, but the estimate was that a 7,700 increase was needed to keep the adjusted count stable.

“Nevertheless, the combination of the widespread pattern of job losses in private sectors, the downward revision to June, and the rise in unemployment, is disquieting,” he continued.