Mar-10-10 Annually Revised Data Show Employment Declined More Than Estimated in 2009; January 2010 Unemployment Rate at 9.9 Percent, Employment Declined by 9,100
In addition, the results of the annual benchmarking adjustment process - conducted each year at this time by every state - showed that the previously announced seasonally adjusted job loss from December 2008 to December 2009 of 90,100 was revised lower to reflect a loss of 114,100 jobs. New Jersey's over-the-year percentage loss of -2.9 percent was slightly better than the nation's -3.6 percent loss (-4.8 million jobs). Moreover, during the recession, December 2007 - December 2009, New Jersey has lost 228,300 jobs (-5.6% vs 6.1% nationally).
Labor force estimates also were revised for 2009 and the state's revised 2009 unemployment rate averaged 9.2 percent, fluctuating within a wide range of 7.3 to 10.0 percent. The nation's unemployment rate averaged 9.3 percent in 2009.
There were small signs of improvement in the state's job market as employment losses slowed in the second half of the year. Over the first six months of 2009, job losses averaged -14,400 per month and slowed to -4,600 per month over the July-December period.
Private sector job loss in 2009 was widespread as most industry supersectors lost jobs over the December 2008 to December 2009 period. Only employment in education and health services, which added 9,200 jobs, and leisure and hospitality (+300) recorded job gains. The largest losses occurred in the trade, transportation and utilities (-29,000 jobs), professional and business services (-28,700), manufacturing (-28,200) and construction (-23,400) supersectors.
The drop in trade, transportation and utilities was driven by the loss of over 15,000 jobs in the retail trade segment as merchants reduced staffing in response to slow consumer spending. The contraction in professional and business services was mainly due to job losses in the administrative support/waste management/remediation segment, resulting from steep declines in hiring at temporary employment and staffing agencies. Construction employment was lower due to the prolonged slump in home building as foreclosures across the state coupled with high unemployment have dampened demand for new construction. The loss in manufacturing continued a long-term downward trend for factory jobholding in New Jersey.
Other sectors that experienced substantial job losses included financial activities (-14,500) and information (-5,900). Losses in financial activities occurred in both the finance and insurance (-9,300) and real estate, rental and leasing (-5,200) components, reflective of the continuing crises in the banking, mortgage and housing markets.
The employment gain in education and health services was mainly due to payroll expansion in the health care and social assistance category (+8,500). Jobs in this area have been expanding rapidly over the past several years, partly in response to changing demographics - specifically the aging of New Jersey's population. The small gain in leisure and hospitality was due to hiring in the arts, entertainment and recreation component.
Despite employment reductions at the state (-3,100) and federal (-1,200) levels, public sector employment was higher by 7,000 over the December 2008 to December 2009 period due to hiring at the local government level (+11,300).
In January 2010, employment in New Jersey contracted further with payrolls receding by an estimated 9,100 over the month based on seasonally adjusted data. All of the loss occurred in the private sector (down by 9,700); public payrolls advanced by 600. The statewide unemployment rate moved slightly lower in January by 0.1 percentage point to a seasonally adjusted 9.9 percent. New Jersey's unemployment rate remained above the national rate of 9.7 percent.
From December 2009 to January 2010, over-the-month significant private sector employment losses were recorded in the construction (-4,100 jobs), financial activities (-3,300), other services (-2,200), professional and business services (-1,600) and manufacturing (-1,400) supersectors. Industry sectors that recorded notable gains included education and health services (+1,900) and leisure and hospitality (+1,100).
Public sector employment was up by 600 over the month due to gains at the federal level (+1,300), which overshadowed losses at the local (-700) level. State government employment was unchanged.
Over the month, the unadjusted workweek for manufacturing production workers decreased by -0.2 hours to 41.8 hours, average hourly earnings increased by $0.02 to $18.05 and weekly earnings were down by -$2.77 to $754.49. Compared with January of last year, the unadjusted workweek was higher by 0.6 hours, average hourly earnings decreased by $0.35 and weekly earnings were lower by $3.59.
Press Release Tables
Nonfarm Employment (Current Employment Statistics Survey)
Nonfarm employment estimates are developed each month from the Current Employment Statistics (CES) survey, a sample of approximately 6,000 employers in New Jersey. Previously released nonfarm employment estimates, including those for 2009, have been revised to new employment benchmarks required annually by the United States Bureau of Labor Statistics (BLS). The process re-anchors monthly sample-based survey estimates to full-universe counts of employment through the third quarter of 2009, primarily derived from records of the unemployment insurance tax system. The universe count of employment is derived from the records of over 260,000 New Jersey employing establishments.
As a result of the benchmark process, the estimated level of not seasonally adjusted nonfarm payroll employment in New Jersey was revised downward by -1.2 percent for the benchmark reference month of March 2009. This year's revision was the largest since a +1.8 percent revision in 2000. Benchmark revisions over the past ten years have averaged plus or minus 0.8 percent. Nationally, nonfarm employment estimates for 2009 were revised downward by -0.7 percent.
Revised data for April 2009 forward incorporate the effect of applying the rate of change measured by the sample to the new benchmark level, as well as updated net business birth/death model adjustments and new seasonal adjustment factors. The November and December 2009 revisions also reflect the routine incorporation of additional sample receipts into the November final and December preliminary estimates.
It should be noted that new procedures recently mandated by the U.S. Bureau of Labor Statistics may result in more variable month-to-month changes.
For further information on these procedures go to http://www.bls.gov/sae/cesprocs.htm.
Unadjusted nonfarm wage and salary employment data has been revised back to 2007 while seasonally adjusted data have been updated back to 2005. In addition, BLS has introduced the extension of seasonally adjusted data for some sector series back to 1990. These series previously were only seasonally adjusted back to 1997. This change has resulted in minor revisions to higher level summary data as well.
Current monthly resident labor force, employment and unemployment estimates are developed using a modeling procedure based on statistical regression techniques. The procedure uses the following variables: (1) responses to the monthly Current Population Survey (CPS), conducted as a joint effort of the U.S. Bureau of the Census and the U.S. Bureau of Labor Statistics of about 1,200 households in New Jersey; (2) unemployment insurance claimant data; and (3) estimates of nonfarm wage and salary employment obtained from the New Jersey Department of Labor and Workforce Development's monthly survey of a sample of employers.
For annual benchmarking processing, labor force data for New Jersey was revised to incorporate updated inputs, updated population controls, re-estimation of models and adjustment to new division and national controls. Furthermore, BLS has introduced a long-run trend smoothing procedure to seasonally adjusted labor force data back to January 1976. This procedure reduces monthly volatility in the estimates and addresses the long-standing issue related to end-of-year revisions. For more information on this topic, please visit www.bls.gov/lau/lassaqa.htm.
The not seasonally adjusted labor force data was revised back to 2005.