New Jersey 's recent pattern of weak job growth has continued into early 2006, with the State suffering a net loss of 2,200 private-sector jobs in January and February, even as private-sector employment grew by 406,000 jobs nationwide.

The NJ Department of Labor reported recently that New Jersey gained 2,800 private sector jobs in February. However, this was more than offset by a loss of 5,000 jobs in January, yielding a net loss of 2,200 private-sector jobs in the first two months of the year. *

The DOL news release also stated that New Jersey 's unemployment rate rose by two-tenths of a percentage point to 4.7 percent in February. The State's unemployment rate has been rising steadily since hitting a low of 4.2 percent last May and is now about the same level as the national rate, which was 4.8 percent in February.

The two-month loss of 2,200 jobs continues a pattern of weak and inconsistent private-sector job growth that has plagued New Jersey since the onset of the 2001 recession. Private-sector employment in New Jersey is still 10,100 jobs below the pre-recession peak of 3.43 million jobs set in December 2000. (See Table) Most of the losses have come in manufacturing, although service-sector job growth has been unusually weak compared with the two previous expansions.

In 2005, New Jersey created 42,900 private-sector jobs (See Chart), a growth rate of 1.3 percent, which was below the national job-growth rate of 1.6 percent. In 2004, New Jersey created only 20,200 private sector jobs, making it 41st in the nation in its rate of private-sector job growth.

The State's poor track record in creating new jobs over the last several years has stirred concern among regional economists, business groups and Governor Jon Corzine, who has made economic growth a top priority of his new Administration.

“Governor Jon Corzine's focus on economic growth and job creation is right on target,” said NJBIA President Philip Kirschner. “We've got to create a more favorable climate for business investment and job growth in this State.”

Looking at job growth by major private-industry sectors over the last six years and two months, the construction trades have been New Jersey's biggest winner. (See Table) Construction employment is now 20,100 jobs above its pre-recession peak of 151,400 set in December 2000, a gain of 13.3 percent.

Manufacturing employment has declined over the same period. The State's manufacturers now employ 321,000 people. This is 101,000 or 24 percent less than they employed six years and two months ago.

While employment in the private-sector service industries has grown, that growth has been lackluster when compared with the robust employment activity seen in the expansions of the 1980s and 1990s. Since December 2000, employment in the private-sector service industries has expanded by a mere 2.5 percent to its current level of 2,925,600 jobs, a gain of just 70,900.

Within the services subsectors, education and health services, as well as leisure and hospitality, have seen the biggest gains, growing by 12.4 percent and 12.9 percent, respectively, over the last six years and two months. Employment declines have been seen in professional and business services (-1 percent); information services (-24 percent), which includes computer and telecommunications services; and trade, transportation and utilities (-3.2 percent).

*The employment data for the month of March was not available at publication time. The NJ Department of Labor is scheduled to release the March data on April 19.

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