New Jersey Job Market Continues to Send Mixed Signals as Unemployment Falls but Payroll Growth Stalls  

New Jersey’s unemployment rate fell sharply over the past year, but employers added relatively few payroll jobs based on new federal labor data released Wednesday.

A separate report, also released today, shows New Jersey’s private-sector job market improved significantly during the final three months of 2025 with job gains at expanding and opening businesses surpassing losses at businesses that are shrinking or closing.

So looking at the whole, we’re seeing another mixed picture.

The U.S. BLS reported that the state’s not-seasonally-adjusted unemployment rate went down a full percentage point from 5.4% in June 2025 to 4.4% in June 2026 and the number of unemployed NJ residents dropped from approximately 265K to approximately 217K with the state’s civilian labor force remaining pretty much the same, 4,937,516 compared with 4,936,350.

The 4.4% figure that came out today is slightly better than the 4.5% seasonally adjusted rate released earlier this month.

Despite the decline in unemployment, New Jersey’s not-seasonally-adjusted payroll employment increased by just 4,000 jobs over the year. A separate seasonally adjusted report released earlier this month showed an increase of 8,000 total nonfarm jobs, including 10,100 private-sector jobs.

A lower unemployment rate doesn’t necessarily correspond with equal growth in payroll jobs because the figures come from separate surveys measuring different things. In this case, however, the state’s civilian labor force remained nearly unchanged while the estimated number of unemployed residents declined by nearly 48,000.

The state had an estimated 4,463,900 nonfarm payroll jobs in June 2026, compared with 4,459,900 in June 2025. That represents an increase of only 0.1%.

Unemployment is based on where people live while payroll estimates are based on where employers are located.

Regionally, unemployment rates declined across the three metropolitan areas listed separately under New Jersey in the federal report.

Atlantic City-Hammonton’s unemployment rate fell from 6.3% to 5.2%. Trenton-Princeton went from 5.6% to 4.6% while Vineland dropped from 7.6% to 6.4%.

Estimated payroll employment, however, was lower in all three areas.

Atlantic City-Hammonton had approximately 1,700 fewer jobs than it did a year earlier, a decline of 0.9%.

Trenton-Princeton had approximately 700 fewer jobs, a decline of 0.2%, while Vineland had about 600 fewer jobs, a decline of 1%.

The figures suggest unemployment declined even in areas where the estimated number of local payroll jobs didn’t increase. Again, that can occur when people find work outside their home area, leave the labor force or when the household and employer surveys produce different results.

The federal estimates also show significant variation among the larger employment divisions covering North, Central and South Jersey.

Payroll employment in the Lakewood-New Brunswick division was about 2,200 jobs lower than it was in June 2025.

The Newark division added about 1,400 jobs while the Camden division added approximately 5,400 jobs, an increase of 0.9%.

The broader New York-Jersey City-White Plains division added 66,800 jobs, but that figure includes parts of both New Jersey and New York and can’t be fully attributed to NJ.

The Philadelphia-Camden-Wilmington metropolitan area added 19,300 jobs across portions of New Jersey, Pennsylvania, Delaware and Maryland.

A second report released Wednesday provides a different view of New Jersey’s employment market.

The Bureau of Labor Statistics’ Business Employment Dynamics report tracks gross job gains at expanding and opening private businesses and gross job losses at businesses that are contracting or closing.

During the fourth quarter of 2025, New Jersey private-sector businesses recorded 212,322 gross job gains and 194,752 gross job losses.

That produced a net increase of 17,570 jobs between September and December 2025 – a big turn around from the prior quarter.

During the three months ending in September 2025, New Jersey tabbed 196,150 gross job gains and 212,804 gross job losses – a net loss of 16,654 which has moved to a 17,570 job gain representing a quarter-to-quarter reversal of 34,224 jobs.

New Jersey’s gross job-gain rate increased from 5.3% of private employment during the third quarter to 5.7% during the fourth quarter. The gross job-loss rate declined from 5.8% to 5.3%.

The job-flow figures don’t mean New Jersey created 212,322 entirely new permanent positions.

Businesses create and eliminate jobs at the same time throughout the economy and the net figure is arrived at by subtracting jobs lost at closing and contracting businesses from jobs gained at opening and expanding businesses.

The Business Employment Dynamics report also covers an older period than the June unemployment and payroll figures with the  job-flow data running only through December 2025.

So by some measures, the state’s labor market improved but without meaningful payroll growth.

The number of unemployed residents fell by nearly 48,000 over the year and private-sector job gains exceeded losses during the final quarter of 2025.

At the same time, statewide not-seasonally-adjusted payroll employment went up by only 4,000 jobs between June 2025 and June 2026. The state’s seasonally adjusted figures showed an 8,000 bump up in total jobs, including 10,100 private-sector jobs.

Several New Jersey employment areas reported fewer estimated jobs despite lower unemployment rates.

The picture painted by this data today can change as BLS plans to publish revision estimates on August 28 using more comprehensive employment counts from the Quarterly Census of Employment and Wages which are largely based on unemployment-insurance tax records filed by employers.

The preliminary estimates won’t immediately revise the official payroll series – final state and metropolitan-area benchmark revisions are expected with the January 2027 State Employment and Unemployment report in March 2027.

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