From the Record:
A surge in New Jersey’s manufacturing employment over the last year has raised the possibility that the more than 40-year decline of the sector has bottomed out.
The state has added 4,600 manufacturing jobs since July 2014, the largest 12-month increase in the sector since at least 1991, according to the earliest records that are readily available on the website of the New Jersey Department of Labor and Workforce Development.
The manufacturing sector has had only a few 12-month employment increases in that period, and those — including upticks in late 2013 and early 2014 — were far smaller than the current one. The largest previous increase in that stretch was in 1997, when the state added 2,900 manufacturing jobs over 12 months.
The recent uptick was about evenly divided between the two categories that make up manufacturing employment figures, with an increase of 2,100 over 12 months in the category of durable goods, those that last a long time, such as household appliances, machinery and equipment. Non-durable goods, which don’t last long, such as food and clothing, accounted for an increase of 2,500 jobs.
While the increase is modest — adding 4,600 jobs is a rise of about 2 percent in manufacturing employment — it provides a relatively strong reversal of the extended tide of factory job losses. And economists, though cautious in light of four decades of manufacturing jobs losses, said the figures suggest that the sector has hit the bottom.
“I would take that as a positive,” said Patrick O’Keefe, director of economic research at CohnReznick, a global accounting firm with an office in Roseland. “It’s bottoming out,” he said, adding that the sector’s apparent surge has come despite the fact that the strengthening dollar and the weakness of some foreign economics have made U.S. goods less attractive to foreign buyers.
Manufacturing employment peaked in New Jersey in 1969, and the predominant trend — until recently — has since been downward. The state has lost on average about 11,600 manufacturing jobs every 12 months since 1991.
Sector employment has fallen by more than half, from 548,000 to the current 247,300, since 1990, and now accounts for just about 6 percent of all jobs in the state, figures on the department website show.
James Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University, said the state shed manufacturing jobs rapidly during the recession and at a slower pace as the post-recession recovery took hold, rarely adding jobs.
The current figures, with a significant increase, suggest that that dynamic may have changed, however, Hughes said.
“This would suggest that maybe we have reached a floor in the long-term steady decline,” he said. “It could be that the long-term hemorrhage in manufacturing jobs may finally be bottoming out.”
Hughes said the proportion of jobs in the state manufacturing industry peaked in the 1940s, when half of all New Jersey’s jobs were in manufacturing, and the state was a strong producer of cars, textiles, chemicals, embroidered cloth, telecommunications equipment and other products. He added that the sector accounted for about one-third of all jobs when the number of jobs peaked in 1969, with service jobs having grown dramatically to become the predominant sector.