N.J. economy likely to lag behind nation's
TRENTON - New Jersey is caught in "the economic doldrums," and its economy likely will perform worse than the rest of the nation through at least 2012, according to a new Rutgers University economic forecast.
TRENTON - New Jersey is caught in "the economic doldrums," and its economy likely will perform worse than the rest of the nation through at least 2012, according to a new Rutgers University economic forecast.
The Rutgers Economic Advisory Service forecast, released yesterday, predicts slow job growth and rising unemployment, and it says a quick turnaround is unlikely.
Nancy Mantell, the service's director, said that although New Jersey's 2007 unemployment rate of 4.3 percent was below the 4.6 percent national average, the state's workforce was shrinking.
"People appear to be dropping out of the labor force rather than looking for work," Mantell said in a statement. Those who stop looking for work are not counted as unemployed, reducing the jobless rate.
She expects an average jobless rate of 5 percent this year, followed by 5.2 percent over the next decade.
"The average unemployment rate is expected to exceed the national rate in 2008, as well as through the 2017 forecast period," Mantell said.
Last year, 24,300 jobs were created in New Jersey through November, or 5,600 fewer than in the same period of 2006.
On the bright side, steady growth in personal income is forecast through 2017, with an average of nearly 5 percent gain per year - well above the expected annual inflation rate of 2 percent. That category includes income from wages, investments and other sources.
Last year, most job gains came in government, followed by education and health services and professional/business services, while half of all jobs lost were in manufacturing.
New Jersey's gross state product - the total value of goods and services produced within the state - is forecast to grow at a modest 2.2 percent on average through 2017, below the national average of 2.5 percent.
"This differential is due to the relatively higher cost of living and doing business in New Jersey, as well as our lower rate of population growth," Mantell said. New Jersey's population is expected to grow by an average 0.6 percent per year, with the total number of residents passing 9 million in 2012.
Separately yesterday, Fairleigh Dickinson University's annual New Jersey consumer survey found residents' confidence in their near-term financial situation is eroding.
The survey found 41 percent say they are worse off than a year ago, up from 35 percent last year. Meanwhile, 27 percent say they are better off than the year before, down slightly from 30 percent.
