N.J. jobless rate at 9.9 percent, but 5,300 jobs added

Posted: September 22, 2012

Capping off 10 days of poor economic news for Gov. Christie, the state announced Thursday that New Jersey's unemployment rate inched up to 9.9 percent in August even as it continued a yearlong trend in adding 5,300 jobs.

The varying economic indicators were described as "kind of nuts" by Christie's top economist and became a launching pad for the administration's criticism of the federal Department of Labor's methodology for determining the unemployment rate.

The monthly jobless numbers - if they hold when they are finalized early next year - would be the highest for the state since the 1970s.

The national jobless rate, on the other hand, fell in August from 8.2 to 8.1 percent, while Pennsylvania's rate went from 7.9 percent to 8.1 percent.

New Jersey's monthly numbers, noted Christie's top economist, Charles Steindel, are based on employment questions asked in a telephone survey of fewer than 2,000 households. Data from surveys of employers were more optimistic, indicating that New Jersey added jobs in 10 of the last 12 months.

"This is a nationwide problem. A lot of states are complaining about it," Steindel said in a conference call with reporters. "There are significant issues involved with how we are calculating those numbers."

He said the Department of Labor's Bureau of Labor Statistics was "constantly refining its procedures."

A spokesman said the BLS does not address criticism of its methodology.

Christie's office sent out quotes from officials in New York and Connecticut who also derided the federal government's methodology.

Paul Harrington, director of the Center for Labor Markets and Policy at Drexel University, agreed that monthly data are not that useful. The change New Jersey saw from July to August - 9.8 percent to 9.9 percent - is statistically meaningless, he said.

He suggested the federal government take quarterly analyses instead. "I think you've got to smooth this out over a period of time," he said.

But that didn't stop Democrats from hammering the Republican governor over the data in a series of statements.

"New Jersey is almost two points higher than the national unemployment average, and most of the recent gains were in the public sector, which certainly has not been the Christie administration's policy goal," said Assembly Speaker Sheila Oliver (D., Essex).

"It's so unfortunate that Gov. Christie has failed to devote more attention to jobs, as the unemployment rate has increased under his watch," she said.

Democrats had plenty of ammunition beyond Thursday's report to slam the governor's fiscal policies.

In recent days, three bond-rating agencies have criticized Christie's optimistic revenue expectations for the $31.7 billion budget that went into effect July 1. Revenues have failed to reach administration projections in July and August, so New Jersey would have to collect 8.2 percent more in taxes this fiscal year compared with last year in order to preserve its budget.

Christie is hoping to use a surplus in that budget to push through a tax cut, which his office plugged again Thursday.

The last budget year may be an added complication.

The nonpartisan Office of Legislative Affairs announced 10 days ago that the administration was on pace to bring in $254 million less than expected from the budget year that ended in June. Christie disputes this number.

His office stressed that data from employers - also released Thursday - is a far better indicator of economic health than the numbers pushed by Democrats.

That report indicates that 47,100 private sector jobs were added from August 2011 to August 2012. Since February 2010, the month that the state calls "the low point of the recession," 86,200 jobs were added. That month was also Christie's first full month in office.

The largest month-over-month gains in private employment in August were in the business services sector, which added 6,100 jobs, due to what the state said was an uptick in hiring at employment services firms.

Government employment accounted for most of the job growth in August, fueled by 2,700 new jobs at the local level. The industry sector with the biggest drops was manufacturing, which lost 2,700 jobs.

Steindel said that the state's own numbers don't jibe with the federal government's assessment of a 9.9 percent unemployment rate.

For example, he said, new unemployment filings would be as high as 15,000 per month if that were true. Instead, they're about 9,000.

And New Jersey would have lost 600 jobs a day in August to reach 9.9 percent unemployment, but "it didn't happen," Steindel said.

So how is New Jersey's job growth doing, given the conflicting numbers and politically charged rhetoric?

Harrington concluded: "I look at this data over the last year and I say New Jersey employment is up a little - and by a little, I say very modest."

Christie is out of state fund-raising and campaigning for gubernatorial and senatorial candidates for the remainder of the week - a fact repeatedly noted by Democrats.

But he didn't escape criticism of the unemployment rate by leaving the state.

In advance of a fund-raising event and a rally Christie will attend Sunday for Missouri Republican gubernatorial candidate Dave Spence, a spokesman for the Missouri Democratic Party was quoted in local newspapers as saying: "Does Dave Spence really want Missouri's economy to look like New Jersey's?"

Contact Matt Katz at 609-217-8355 or mkatz@phillynews.com, or follow on Twitter @mattkatz00. Read his blog, "Christie Chronicles," at www.philly.com/christiechronicles

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