NEWARK, N.J. — Job losses are undermining turnaround efforts in New Jersey’s largest city, where the unemployment rate reached a 15-year high in June.
Newark’s unemployment rate surged to 14.3 percent, the highest level since July 1994, according to the U.S. Labor Department. That compares with 13.4 percent in May and 9.5 percent for June 2008.
“That’s dangerous,” economist Jeffrey G. Otteau said of the Newark jobless rate. “That rate is right on the bubble in terms of the point at which people begin to give up hope. At 16 percent things start to look hopeless.”
Otteau said he does not expect to see sustained improvement in the U.S. labor market until next year, despite a national report released Friday that showed an unexpected drop in the jobless rate.
The U.S. unemployment rate fell to a seasonally adjusted 9.4 percent in July, from 9.5 percent in June. Federal unemployment data typically is released weeks ahead of state and city jobless rates for the same months.
New Jersey’s unemployment rate hit a seasonally adjusted 9.2 percent in June — a 32-year high.
Newark, a city of 280,000 residents and a logistical hub for nearby New York City, has been hit hard by the worst recession since World War II. The downturn has also cut into shipping activity and employment at the Port of Newark.
“Our nation has seen a 3 percent to 5 percent rise in the unemployment rate (and) Newark is no different,” Mayor Cory Booker said. “These numbers represent real people and painful challenges.”
Thirty-eight of the 96 New Jersey communities with more than 25,000 residents had double-digit jobless rates in June, led by Trenton at 18.4 percent. That compares with four communities in June 2008.
City jobless data are not adjusted for seasonal variations, making year-ago comparisons more meaningful than those with the preceding month.
Gov. Jon Corzine said he’s hopeful New Jersey’s unemployment rate will mimic the dip at the national level when the state numbers are tabulated for July. It was the first time the U.S. jobless rate has declined in 15 months.
“We certainly hope so,” Corzine said. “We’re actually working very hard to create jobs.”
Source:
