Newswise — New Jersey's economy is defying the national trend of a slowing recovery momentum from COVID-19-driven economic losses. The Garden State’s comeback is proceeding far faster than New York City’s recovery across the Hudson River, according to a new Rutgers report.
“New Jersey has climbed four-tenths of the way out of the deep recessionary hole it fell into in March and April,” said James W. Hughes, University Professor and dean emeritus of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University-New Brunswick, and a report coauthor. “The United States’ overall loss of momentum should not precipitate an economic stall, but does put on the back burner any fantasy of a nationwide economy roaring back to pre-pandemic life.”
According to the report, “Coronavirus Economic Downshift: New Jersey Defies the National Deceleration,” New Jersey has regained 41.1 percent of the pandemic-driven job losses, compared with a 41.9 percent recovery in jobs for the nation and a 17.1 percent recovery for New York City.
However, the state still faces a daunting road to full economic recovery. New Jersey must regain 490,000 jobs to return to its pre-pandemic employment peak of February 2020. But the rehiring bursts of the last three months may have run their course, the researchers said.
Hughes noted that New York City’s strong growth before the pandemic made it a powerful national and regional economic locomotive, providing a major boost to New Jersey.
“Whether or not New Jersey can depend on the city to bolster its economic fortunes will be questionable but one thing remains true: New Jersey and the broad New York metropolitan region will be linked together in confronting new and painful economic realities,” he said.
The researchers expect potential long-term structural changes in the housing market.
“Housing is becoming a multi-functional ‘live, work, play habitat,’” said Hughes. “Homes are now being used for shelter, remote workplaces, educational – or remote – classrooms and home health clubs. This new multi-functional role can reshape the entire housing landscape of New Jersey and the region.”
Currently, the new shelter dynamic is bolstering suburban single-family housing markets, he said.
Coronavirus Economic Downshift: New Jersey Defies the National Deceleration is the fourth in a series of Fast Track Research Notes, published by the Rutgers Center for Advanced Infrastructure and Transportation (CAIT) on the pandemic’s economic fallout. The reports’ authors are Joseph J. Seneca, University Professor emeritus and Distinguished Professor of Economics emeritus; Hughes; and Connie O. Hughes, former Chief of Management and Policy, New Jersey governor’s office.
Fast Track Research Notes Issue Number 5, to be released the week of September 21, will help to determine if the national loss of momentum continues, and whether New Jersey can continue to defy the national trend and strengthen its recovery.
The current report is available here.