From the Asbury Park Press:
New Jersey’s private-sector job growth ranked 41st nationwide each of the past two years in a sign that its high costs drove employers away, Rutgers University economists said in a report released Monday.
And the state faces bleak prospects: New Jersey has a high concentration of jobs in the financial services sector, which is getting hit hard in the economic downturn, they said.
“I’ve seen a lot of cyclical times with real estate, but I’ve never seen it this bad,” said Arnie Lubliner, general manager of Winstar Mortgage Co. in Manasquan, where business in 2007 was off 63 percent from the previous year.
The report by Rutgers economists James W. Hughes and Joseph J. Seneca comes as bad news to business owners and workers, who had hoped the worst of the economic downturn was behind them.
It argues New Jersey’s economy has several obstacles. The state’s job growth is slower even than its high-cost neighbors, and it sits at the epicenter of the financial services industry.
“This is a very significant economic storm that we have entered into,” Hughes said.
The report found New Jersey’s private sector grew by 0.8 percent in 2006 and 0.1 percent in 2007. By comparison, New York’s private sector grew by 1.5 percent in 2006 and 1.2 percent in 2007, and Pennsylvania’s private sector grew by 1.2 percent in 2006 and 0.6 percent in 2007.
That puts New Jersey in the company of states that have been considered economic trouble spots: California, Nevada, Florida and Arizona have also felt the most pain from the housing bubble’s collapse.
“New Jersey has become a place where it is very, very expensive to operate — even within the region,” said Philip Kirschner, president of the New Jersey Business and Industry Association, the state’s biggest business lobby. A quick recovery isn’t likely, the economists said. New Jersey and the rest of the nation are caught in a downturn stemming from a slow housing market. That has forced lenders to tighten their credit standards.
New Jersey is likely to suffer more than others. Financial activities — banking, brokerages, real estate and finance — account for 6.9 percent of the state’s employment, compared with 6.1 percent of U.S. employment, Hughes said.