New Jersey has the 7th highest unemployment rate in the country. This is due to several reasons, say the experts.


Despite windows plastered with signs saying “help wanted” and companies offering new hire incentives, New Jersey’s unemployment rate remains among the highest in the country.

Tied for the nation’s seventh highest unemployment rate with Washington DC, New Jersey has an unemployment rate of 7.5% – just a 0.1 point jump from March – and has regained 54% of jobs lost due to the coronavirus pandemic, according to the April Bureau of Labor Statistics report.

The high rate persists even as staff shortages in restaurants and stores continue, leaving some businesses in panic at a crucial time in the recovery. But economists said there were reasons for the rising unemployment rate and the state‘s continued exploration.

“We have been very smart about reopening and our job growth historically over the past decade has been slower than the nation,” said James Hughes, economist and professor at Rutgers University. “There is no one answer for the higher rate, but multiple possibilities and contributors.

The coronavirus pandemic is hurting New Jersey’s economy much more than other states, he said, which means it will take more time and more effort for the state to recover and dig. of its hole, noting that New Jersey has been slower in lifting restrictions than states in other parts of the country. Other states with high unemployment rates include California, New York and Connecticut, which were also coronavirus hotspots at the height of the pandemic.

He also pointed to the overall reduction in the workforce – many parents were forced to stay home due to lack of child care, as many New Jersey schools followed a hybrid and shift schedule. other workers who were reluctant to return because of their own health. worries and fears. While vaccination rates have exceeded 50%, face-to-face service jobs are still considered riskier.

In addition, people who are not looking for work are not counted in the unemployment rate, said Oliver Cooke, professor of economics at Stockton University. There is also no way to calculate workers whose hours have been reduced due to the pandemic.

“It’s the unemployment rate problem that makes it difficult during COVID – at first all these people lose their jobs, then there’s a lot of ‘who’s in the workforce and who isn’t. ? ‘ because technically, to be unemployed, you have to look for a job, ”he said.

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The two economists agreed that the effect of improved UI benefits, which come with an additional weekly check of $ 300 through September 4, has been overstated.

But what could encourage more people to return to work is to relax the mask’s mandate and lift other capacity restrictions, experts said. Some other states relaxed those restrictions months earlier. If white collar workers start to return to the office and use public transportation, it will also bring back more support staff in different service industries.

“The occupancy rate in Manhattan is still well below 20%. Once that office echo system is restored, like the restaurant workers that serve lunch and happy hours and the awesome maintenance workers, you will start to see those face-to-face service jobs coming back that are related, ”said Hughes, noting New Jersey’s unique position as a suburban state between two major cities may dampen the rate relative to other states that rely on natural resources like oil.

The summer season tourist economy will be of vital importance to the Jersey Shore, which was hit hard last year while major restrictions were still in place.

The shore has been particularly hard hit due to reliance on the entertainment and hospitality industry, devastating Atlantic County which relies on year-round conventions and casino enthusiasts after the coastal season. New Jersey still lags the country in recovering hospitality jobs – 55% compared to the nationwide recovery of 61%, according to BLS figures.

The expert said staffing issues on the coast are due to a drop in the number of teenagers taking up jobs, as well as a sharp drop in the number of seasonal workers from abroad, who work on walks, due to the visa backlog.

“We pray for a robust summer here. People who have been successful in keeping their jobs and working remotely have built up savings and a demand for beach time, there is a lot of stimulus money flowing through the system, shore homes are in high demand Cooke said. “We’ll have to wait and see what happens over the summer.”

Cooke believes New Jersey will not return to pre-pandemic unemployment levels – the lowest in state history – but predicts that by the end of 2022, the unemployment rate will rebound significantly .

With the opening of all schools in the fall, parents, who have had to stay home to care for children, will be able to return to the workforce. Small stores that may have laid off some workers due to social distancing requirements will be able to bring back more workers. And a huge federal infrastructure bill could be on its way, pumping $ 2.3 trillion into the economy.

“It will take time and it really depends on the basic model of job creation to job recovery,” Hughes said. “The question is how many jobs are going to rebound as we move into July and August and move away from the pandemic, and very soon we’ll start to see.”

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Sophie Nieto-Munoz can be reached at [email protected]. Follow her on @snietomunoz.

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