Reinventing Jersey

From CoStar:

As Former Toys R Us Campus Awaits New Use, New Jersey Embarks on Transforming the American Office Park

The future of the former Toys R Us corporate headquarters is still to be determined in New Jersey, a state that’s been ground zero nationally for the redevelopment of such large, isolated and what some call outdated suburban workplace campuses. But when its fate is decided, the outcome could help write the next chapter for America’s office parks.

For years, before its bankruptcy and liquidation in 2018, retailer Toys R Us occupied a 193-acre property in Wayne, a bucolic site on the waterfront of a reservoir. The campus was anchored by two connected office buildings totaling about 621,000 square feet at 1 Geoffrey Way. The property was sold in 2019 for $19 million and now sits mostly vacant.

A consulting firm, BRS of Medford Lakes, New Jersey, presented a market study on Thursday it did on the area where the campus is located, detailing its demographics and vacancy rates for different property categories. After months conducting that research and receiving input from residents, BRS said it will release its final report with recommendations for the best ways to repurpose the Toys R Us buildings, transitioning them to mixed use, by the end of the month. Those possible options include research and development space, shops, restaurants, and a performance hall.

“Based on our surveys … a lot of people have said that in addition to use for recreation bringing them to the site, there was a lot of interest in entertainment activities and dining and children’s activities, as well as festivals and shopping,” Alisa Goren, a BRS planner, said during the presentation. “So it looks like a lot of things that would bring you to the site are also things that would be appropriate and attractive to the market as a whole.” 

The process playing out in New Jersey is part of a commercial real estate discussion taking part across the country. The national challenge of finding ways to repurpose and revitalize office properties isn’t going to go away, as even more companies rethink their workplace needs because of the pandemic and the work-from-home trend it accelerated. That’s led to some firms downsizing their footprints. 

The former home of Toys R Us isn’t the first large corporate campus to be reimagined in the Garden State. New Jersey has seen more than its fair share of the redevelopment of former one-tenant suburban office complexes, dubbed “stranded assets,” some of which had been vacant for years. That’s because during roughly the past decade a number of companies exited their headquarters in the Garden State in the wake of mergers and acquisitions, belt-tightening, an effort to escape New Jersey’s high taxes, or in strategic moves. The repurposing of some of those sites is complete, offering a model for developers in other parts of the nation.

Posted in New Development, New Jersey Real Estate | 21 Comments

Low rates – never again?

From the Washington Post:

The Fed’s Damage to the Housing Market May Last Years

With interest rates now hovering around 5%, existing-home sales are down more than 14% from last year. Some potential buyers are sitting on the sidelines until rates or prices or both decline, while sellers are hoping the market picks up again so they can get a higher price. 

But don’t count on rates falling to those pandemic lows. They were the result of extraordinary market manipulation from the Fed. And unless this becomes a regular feature of monetary policy, rates are not going back to what they used to be.

The real estate market has been on a wild ride. House prices, measured by the Case-Schiller index, increased 30% between March 2020 and December 2021, a steeper rise than the lead-up to end the housing bubble in 2008. This was in part because many people moved during the pandemic, but also because the 30-year mortgage rate was only 2.65% in spring of 2021. 

The impact of the Fed’s interference may be felt for years. In the spring of 2020, the Fed was desperate to avoid economic collapse, so it reverted to its 2008 playbook. It cut rates to zero and brought back quantitative easing, buying long-dated government bonds and mortgage-backed securities (MBS). Most residential mortgages are securitized by Fannie Mae or Freddie Mac, and resold in what is known as an agency MBS. 

In 2020, the mortgage-backed security market was in trouble, and the Fed was even more aggressive than it was in 2008. It effectively became the only ultimate buyer of these securities: Its holdings of agency MBS increased by $1.3 trillion between 2020 and 2022, while the market for agency mortgage-backed securities grew by $1.5 trillion. The Federal Reserve now holds more than 40% of the total outstanding amount of agency MBS, or nearly half the market. 

These actions were one big reason rates fell so low. Your mortgage rate is based on the 10-year bond rate, plus a premium for the extra risk involved. The size of that risk premium is largely determined in the MBS market, based on the liquidity and rate risk the investor takes on. The figure below shows the Bloomberg US MBS index minus the yield on 10-year bonds. 

Posted in Economics, Housing Bubble, Mortgages, National Real Estate | 54 Comments

Going to battle with NYC

From NJ Globe:

Gottheimer, legislators combat NYC congestion pricing by offering incentives to keep jobs in N.J.

Stepping up his fight against New York City’s congestion pricing plan, Rep. Josh Gottheimer (D-Wyckoff) and three Bergen County legislators today announced a new proposal that would incentivize New Jersey commuters to stay on their side of the Hudson.

Legislation offered by State Sen. Joseph Lagana (D-Paramus), Assembly Appropriations Committee Chair Lisa Swain (D-Fair Lawn) and Assemblyman Christopher Tully (D-Bergenfield) offers tax credits for New York-based companies to open regional offices in New Jersey, and reward businesses that help reduce commuting costs for their employees.

The New York plan, which Gottheimer called a Congestion Tax, could cost New Jerseyans who drive to New York an extra $23 per day, on top of tolls, gas and parking,

“Just read MTA spelled backwards and it tells you exactly how New York looks at New Jersey right now: as their personal ATM,” said Gottheimer.  “The ‘Stay in Jersey’ bill will establish a new incentive program to provide New York businesses with tax credits for expanding business operations into New Jersey — closer to the primary residence of existing Jersey full-time employees — to help them avoid having to drive into the city and get whacked by the Congestion Tax.”

The lawmakers argue that their plan would improve work productivity, reduce commuter stress, enhance family time, protect the environment, and create New Jersey jobs.

Lagana, who represents a suburban Bergen district full of commuters, said that New York City’s bid to “add exorbitant congestion pricing fees” makes a cost-cutting plan necessary.

“It’s no secret that working close to home benefits not only residents themselves, but is a boon to local economies,” Lagana said.  “Business hubs spur economic development and investment in our mom and pop shops, local eateries and markets, and boutique downtown stores.”

Posted in Economics, Employment, New Jersey Real Estate, NYC | 160 Comments

Inventory … UP!

From the NAR:

Realtor.com® July Housing Report: Inventory Rises at Record-Breaking Speed

The inventory recovery accelerated in July, as active listings increased at record-fast1 annual pace (+30.7%) for the third month in a row, according to the Realtor.com® Monthly Housing Trends Report released today. Although buyers had more for-sale home options in July, competition remained largely in sellers’ favor, with listing prices near all-time highs and homes selling more quickly than pre-COVID.

Between supply and demand trends, July data indicates that softening buyer interest is the bigger driver of accelerated inventory improvements. With typical monthly mortgage payments now 1.5 times higher than in July 2021, recent home sales data shows that many buyers are putting their plans on pause, which is giving active listings room to grow. However, the shift in market conditions seems to be having the opposite effect on seller activity, with new listings declining for the first time since March. This suggests that some homeowners are reconsidering their plans to list in light of trends like declining numbers of homes under contract. Despite the new seller dip, active listings grew at a record-fast pace for the third straight month in July, further signaling a real estate refresh on the horizon for 2022 buyers.  

  • In July, the U.S. inventory of active listings increased 30.7% year-over-year, faster than ever before in Realtor.com®‘s data history, building on record-breaking paces in June (+18.7%) and in May (+8.0%). These continued improvements are partly due to ongoing annual declines in pending listings, which were bigger in July (-19.4%) than in June (-16.3%).
  • Nationally, newly listed homes were down 2.8% compared to July 2021, with the biggest drops registered in the northeast (-14.3%) and midwest (-11.0%). With northern regions less equipped for scorching temperatures, these trends suggest that recent record-breaking heat waves may also have played a role in July’s new seller pullback.
  • Relative to the national rate, active inventory grew at a faster annual pace (+41.0%) across the 50 largest U.S. metros in July, on average. Forty-five markets posted active listings gains, led by Phoenix (+158.7%), Austin, Texas (+154.5%) and Raleigh, N.C. (+137.5%).
  • More new sellers entered the market than last year in 13 of the biggest metros, with new listings jumping most significantly in Las Vegas (+37.6%), Nashville, Tenn. (+37.1%) and Oklahoma City (+28.6%).
Posted in Housing Bubble, National Real Estate | 107 Comments

Rebalancing or Crash?

From MarketWatch:

Annual home price growth saw ‘the greatest single-month slowdown’ since at least the early 1970s. Does this mean homebuyers are finally getting a break?

Is this the news home buyers have finally been looking for? In June, the annual home price growth rate saw the “the greatest single-month slowdown on record since at least the early 1970s,” according to mortgage data and analytics company Black Knight. What’s more, this was coupled with the “largest single-month influx of for-sale inventory in 12 years,” the firm noted in release about its latest Mortgage Monitor report on August 1. 

The report reveals that June was the third straight month of cooling, with annual home price appreciation dropping from 19.3% in May to 17.3% in June; this is an even more pronounced drop even than in 2006. (For its part, the US CoreLogic S&P Case-Shiller Index also marked a decrease, with June “appearing to be a tipping point with a more significant pullback in buyer interest,” according to a report released at the end of July.) In fact, all 50 top metro markets saw growth slow in June with one in four major US markets seeing growth slow by 3 percentage points or more.

But why are we seeing this cool down? Holden Lewis, home and mortgage expert at NerdWallet, says mortgage rates are much higher than they were at the beginning of the year, forcing buyers to shop for homes in lower price ranges so they could afford the monthly payments. “As people buy less expensive properties, they drag down the rate of house price growth. This summer’s main lesson is the importance of setting a reasonable asking price,” says Lewis. 

What’s more, Zillow economist Nicole Bachaud says the housing market is in the midst of a major transition. “Buyers have hit an affordability ceiling and demand is pulling back, causing homes to pool on the market as sales slow. Home sellers are being forced to adjust their expectations and many are opting to stay out of the market and keep their favorable interest rate,” says Bachaud. 

To the delight of homebuyers and the chagrin of home sellers, Greg McBride, chief financial analyst at Bankrate, says this is not the housing market of a few months ago. “Sellers won’t get the moonshot asking price they thought, it will take longer to sell and there won’t be a bidding war. While buyers have more negotiating power now, mortgage rates remain above 5% and home prices are still lofty,” says McBride.

While headline-generating movements are to be expected during this period of transition, Bachaud says it’s important to remember just how far prices have risen not only during the pandemic, but over the past decade. “We are talking about small dips from record highs. A fall back near pre-pandemic levels is very unlikely as overall housing supply will remain a barrier and demand will still exist on the sidelines,” says Bachaud. Ultimately, she says, this a much-needed market rebalancing could help some first-time buyers catch up while homeowners will retain much of the equity they’ve built over the years.

Posted in Economics, Housing Bubble, National Real Estate | 140 Comments

Ain’t the same bubble

From Yahoo Finance/Bloomberg:

Almost Half of Mortgaged Homes in US Now Considered Equity-Rich

Nearly half of mortgaged properties were considered equity-rich in the second quarter — meaning owners had at least 50% in home equity. This marked the ninth straight quarterly rise, fueled by soaring house valuations in the pandemic era and an increase in down payments by recent buyers, according to real estate data provider Attom.

Although the housing market has cooled recently, the percentage of equity-rich properties will probably keep increasing, according to Attom.

“While home price appreciation appears to be slowing down due to higher interest rates on mortgage loans, it seems likely that homeowners will continue to build on the record amount of equity they have for the rest of 2022,” Rick Sharga, executive vice president of market intelligence at Attom, said in a statement.

The gains were particularly sharp in the south, where many Americans moved during the pandemic.

In Florida, more than 60% of mortgaged homes are now equity-rich, up from about a third a year ago. It’s good news for owners and for municipalities as well, as it creates a more stable financial environment.

Nationwide the portion of mortgaged homes that were equity-rich reached a record 48.1% in last quarter, up from 44.9% in the first quarter and from 34.4% a year earlier, Attom said.

Areas with the highest share of equity-rich properties included Martha’s Vineyard and Nantucket, Massachusetts; Burlington, Vermont; and Gillespie county and Travis county near Austin, Texas.

Meanwhile, the share of homes that were considered seriously underwater — where the mortgage is 25% greater that the property’s estimated market value — dropped to a low of 2.9%.

Posted in Housing Recovery, National Real Estate | 40 Comments

Jobs Day!

From CNBC:

Stock futures are flat with all eyes on the July jobs report

Stock futures were little changed Friday as investors waited for the July jobs report, looking for further clues about the Federal Reserve’s path of rate hikes and the state of the economy.

Futures on the Dow Jones Industrial Average were up 25 points or 0.08%. S&P 500 and Nasdaq 100 futures fell slightly.

Economists expect 258,000 jobs were added in July, down from 372,000 in June, according to Dow Jones. Unemployment is expected to hold steady at 3.6%. The jobs report will be released Friday at 8:30 a.m. ET. 

“Investors will be waiting to see if the labor market can withstand the Fed’s rate-hike campaign as well as it did in June,” said Mike Loewengart, managing director of investment strategy at E-Trade.

Job growth is expected to slow as the Fed continues to hike interest rates to tame surging inflation, but it’s unclear whether that slowing will tip the economy into an official recession. Many said Friday’s report is crucial as it’s one of two the central bank will see before it decides how much to raise rates at its September meeting.

Posted in Demographics, Economics, Employment | 74 Comments

Where people “go” to work

From the NYT:

What Remote Work Debate? They’ve Been Back at the Office for a While.

The competition for parking space is getting steeper. Commutes are inching longer. Workplace lounges are filling up with commotion as junior associates play cornhole. What return-to-office debate? In some parts of the country, it’s been settled.

“I know almost nobody in Columbus who is fully remote,” said Grant Blosser, 35, who works at a financial services firm.

In October 2020, Mr. Blosser started going back into his office in Columbus, Ohio, five days a week. He cracked jokes with the young analysts, one of whom recently dragged his team to hot yoga. (It “kicked our butts.”) He listened to his book club’s selection in the car (currently, a biography of Winston Churchill). It was a relief, he said, to feel the “separation of church and state” that came from leaving the house each day.

“Almost everybody I know is in an office most of the time here,” he said. “The headlines that I read about as far as people dragging their feet going back to the office are about select companies and select cities.”

More than two years into the pandemic, American corporate workplaces have splintered. Some are nearly as full as they were before Covid-19 struck; others sit abandoned, printers switched off and Keurig cups collecting dust. Workers in America’s midsize and small cities have returned to the office in far greater numbers than those in the biggest U.S. cities. Some executives in large cities are hoping they’ll catch up, though they’ve been impeded by safety and health concerns about mass transit commutes, as well as competitive job markets where employees are more likely to call the shots.

In small cities — those with populations under 300,000 — the share of paid, full days worked from home dropped to 27 percent this spring from around 42 percent in October 2020. In the 10 largest U.S. cities, days worked from home shifted to roughly 38 percent from 50 percent in that same period, according to a team of researchers at Stanford and other institutions led by the economists Steven Davis, Nick Bloom and Jose Maria Barrero.

Posted in Demographics, Economics, Employment, National Real Estate | 111 Comments

How to lower your NJ property taxes

From the Philly Inquirer:

Ivana Trump is buried at Donald Trump’s New Jersey golf club. Could that mean a tax break for the former president?

Ivana Trump’s death grabbed international headlines, but her New Jersey burial place is now garnering suspicion that its location could mean tax breaks for her ex-husband, former President Donald Trump.

Ivana, Trump’s first wife, died July 14 after suffering blunt-impact injuries during a fall at her home in New York City, ABC reports. A medical examiner ruled her death an accident. She was 73.

She has since been buried in a plot of land at Trump National Golf Club, a sprawling course in Bedminster, N.J., that opened in 2004. Now, due to the intricacies of New Jersey’s tax laws and how they apply to “cemetery companies,” some say the course could be getting a tax break.

After the burial, some critics pointed out that by using an area of the golf course as a cemetery, the Bedminster property could be eligible for tax breaks under New Jersey law.

According to the Garden State’s tax code, “cemetery companies” — any entity that “owns, operates, controls, or manages land or places” used for the burial of human remains — is exempt from many forms of taxation. Those include property taxes “on lands dedicated to cemetery purposes,” income taxes, sales and use taxes, business taxes, and inheritance taxes.

Brooke Harrington, a Dartmouth College sociology professor and tax researcher, tweeted over the weekend that Donald Trump employing the golf course as a cemetery is a “trifecta of tax avoidance.” She added that there is“no stipulation regarding a minimum # of human remains necessary for the tax breaks to kick in” and that having one body buried there could “suffice to make at least 3 forms of tax vanish.”

“If Trump did this for the tax break, he may well have complied with NJ law — which case there would be no legal basis for punishment,” Harrington said.

A Trump Organization representative said in an email to Fortune that calling Ivana’s grave a way to avoid taxes was “truly evil.”

Posted in New Jersey Real Estate, Property Taxes | 54 Comments

Housing market slows … kind of

From CNBC:

Home prices cooled at a record pace in June, according to housing data firm

Rising mortgage rates and inflation in the wider economy caused housing demand to drop sharply in June, forcing home prices to cool down.

Home prices are still higher than they were a year ago, but the gains slowed at the fastest pace on record in June, according to Black Knight, a mortgage software, data and analytics firm that began tracking this metric in the early 1970s. The annual rate of price appreciation fell two percentage points from 19.3% to 17.3%.

Price gains are still strong because of an imbalance between supply and demand. The housing market has had a severe shortage for years. Strong demand during the coronavirus pandemic exacerbated it.

Even when home prices crashed dramatically during the recession of 2007-09, the strongest single-month slowdown was 1.19 percentage points. Prices are not expected to fall nationally, given a stronger overall housing market, but higher mortgage rates are certainly taking their toll.

The average rate on the 30-year fixed mortgage crossed over 6% in June, according to Mortgage News Daily. It has since dropped back in the lower 5% range, but that is still significantly higher than the 3% range rates were in at the start of this year.

“The slowdown was broad-based among the top 50 markets at the metro level, with some areas experiencing even more pronounced cooling,” said Ben Graboske, president of Black Knight Data & Analytics. “In fact, 25% of major U.S. markets saw growth slow by three percentage points in June, with four decelerating by four or more points in that month alone.”

Still, while this was the sharpest cooling on record nationally, the market would have to see six more months of this kind of deceleration for price growth to return to long-run averages, according to Graboske. He calculates that it takes about five months for interest rate impacts to be fully reflected in home prices.

Posted in Economics, Housing Bubble, Housing Recovery, National Real Estate | 52 Comments

NJ: Want your tax break? Get back to the office.

Disregard the source, was trying to find a non-paywalled version of this article yesterday.

From Florida Realtors:

N.J. to Companies: Make Workers Return

While companies continue to wrestle with the employee question – Should they be allowed to work remotely and, if so, how much? – a state government has gotten involved and more could follow.

The core issue: If a state grants a company tax breaks for agreeing to relocate or expand its business with its borders, the agreement usually includes a minimum number of new jobs. But while a company may indeed meet that mandate, does it count if those actual workers are doing their job remotely from another state?

In New Jersey, officials told about 800 businesses that they must require staff to work in the office or lose millions of dollars in state tax breaks which, cumulatively, total about $8.7 billion. At least two companies that employ more than 1,000 workers have balked, noting the pandemic isn’t over yet. 

But the issue won’t go away, and other states are studying New Jersey’s plan.

According to New Jersey officials, businesses who receive tax breaks under their “Grow N.J.” program must require staff to work in the office at least three days per week.

State officials say business growth isn’t based on only business tax growth. Growth programs also rely on jobs – often higher paying jobs – and increased business for local restaurants, service industries and retail establishments.

Two companies opted to turn down the tax breaks, but they’re not leaving the state for now.

“These two companies are leaving the Grow NJ program, not the state,”, added in a statement Tuesday. 

The program’s rules “are clear and we hold companies accountable to those rules,” says Virginia Pellerin, a spokesperson for New Jersey’s economic development group. “It is important to the state’s economy to have more workers back in offices supporting small businesses in their downtowns and central business districts.”

Posted in Economics, Employment, New Jersey Real Estate, Politics | 152 Comments

Recession Day?

From the WSJ:

Is the U.S. in a recession? GDP report will give us clues

On Thursday, we’ll get an important report card on the U.S. economy. 

GDP, or gross domestic product, tells us how much the economy grew or shrank in the previous quarter. 

In the first three months of the year, GDP decreased at an annual rate of 1.6%. That contraction startled economists and investors alike. 

Now, there are fears that the economy contracted for a second quarter in a row. 

“A common definition of recession is two negative quarters of GDP growth,” Treasury Secretary Janet Yellen noted in an appearance on NBC’s Meet the Press. “When we’ve seen that, there has usually been a recession.”

But Yellen notes that things are different now in the U.S. economy. “When you’re creating almost 400,000 jobs a month, that is not a recession,” she said.

Posted in Economics | 136 Comments

Is Dr. Doom Right?

From Bloomberg:

Shallow Recession Calls Are ‘Totally Delusional,’ Roubini Warns

Economist Nouriel Roubini said the US is facing a deep recession as interest rates rise and the economy is burdened by high debt loads, calling those expecting a shallow downturn “delusional.”

“There are many reasons why we are going to have a severe recession and a severe debt and financial crisis,” the chairman and chief executive officer of Roubini Macro Associates said on Bloomberg TV Monday. “The idea that this is going to be short and shallow is totally delusional.” 

Among the reasons Roubini cited was historically high debt ratios in the wake of the pandemic. He specifically mentioned the burden for advanced economies, which he said continues to rise, as well as in some sub-sectors.  

That differs from the 1970s, he said, when the debt ratio was low despite the combination of stagnant growth and high inflation known as stagflation. But the nation’s debt has ballooned since the financial crisis of 2008, which was followed by low inflation or deflation due to a credit crunch and demand shock, he added.

“This time, we have stagflationary negative aggregate supply shocks and debt ratios that are historically high,” said Roubini, who is nicknamed Dr. Doom for some of his dire predictions. “In previous recessions, like the last two, we had massive monetary and fiscal easing. This time around we are going into a recession by tightening monetary policy. We have no fiscal space.”

Posted in Economics, Employment, National Real Estate | 234 Comments

Who to blame?

From Vice:

Good News: Economy Sucks, You’re Screwed, and It’s All Your Fault, Economists Say

Good news everyone: wage increases are slowing, raises are getting smaller, layoffs are beginning to happen, and inflation is all your fault. And you should be grateful about all of this, according to a series of recent headlines from the economic and political press.

“Millennials are to blame for sky-high inflation,” a CNBC tweet recently read. Politico ran an article titled “Pay raises are getting smaller. That could be a good thing for workers.” The premise was quite simple: inflation was being driven by wage growth, inflation is hurting workers, slowing down wage growth will help workers eventually. Politico later changed the headline to “There’s one hopeful sign for the Fed on inflation. Really” after backlash but the core thesis remained the same. 

As debates over who or what is to blame for inflation and the looming threat of a recession, commentators have begun to focus on millennials again and the way they should (and shouldn’t act) in the current moment.

In the CNBC article, Smead Capital Management’s chief investment officer, Bill Smead suggested millennials were to blame for inflation for spending years saving money instead of buying homes and cars.

“So we have in the United States a whole lot of people, (aged) 27 to 42, who postponed homebuying, car buying, for about seven years later than most generations,” Smead told CNBC. “But in the past two years they’ve all entered the party together, and this is just the beginning of a 10-to-12-year time period where there’s about 50 percent more people that are wanting these things than there were in the prior group.”

This picture doesn’t exactly square with reality, however. In June, a CNBC survey of wealthy millennials (millionaires) found that nearly half were deterred from buying a car, a car, or taking a vacation because of inflation and interest rate hikes. An earlier survey in February painted a darker picture where nearly half of millennials said their savings had decreased during the pandemic and a third said their savings were less than their credit card debt.

Gains from the pandemic were largely limited to wealthy boomers and corporations, in fact. It is, after all, the wealthiest 10 percent of Americans who own 90 percent of stock and saw the pandemic rally transfer more wealth upwards into their pockets. Corporations in highly concentrated industries have been able to hijack prices and curtail wages while shifting blame to consumers and workers squeezed for fatter profit margins.

Posted in Demographics, Economics, Employment, Politics | 46 Comments

Welcome Back to … Normal?

From the APP:

NJ private-sector jobs back to pre-COVID levels. But will hiring spree last?

New Jersey added 9,800 jobs and its unemployment remained a low 3.9% in June, the state Department of Labor and Workforce Development said Thursday in a sign that businesses and consumers have continued their robust spending despite the highest inflation levels in 40 years.

With the latest job gains, the Labor Department noted, New Jersey has recovered all of the 702,000 private-sector jobs that it lost during the first two months of the pandemic in 2020.

“Despite all the worries about inflation, worries about consumer spending, the state’s job market is still very, very strong,” Rutgers University economist James W. Hughes said.

The monthly unemployment report is made up of a survey of employer payrolls to measure the number of jobs and a survey of households to measure the unemployment rate. It is considered a key economic indicator, Hughes said, since employers will begin to cut back on hiring, or even lay off workers, if they see bleak prospects ahead.

New Jersey’s job market, like the nation’s, has recovered from the COVID-19 losses faster than economists expected thanks to a huge federal stimulus and record low interest rates that put money in consumers’ pockets, experts have said.

When the public sector is included, the Garden State through June regained 98% of the jobs it lost during the onset of the pandemic, in line with the U.S.

The state Labor Department said Thursday that New Jersey ended the first half of the year with 96,000 jobs, a pace slightly slower than last year, but still one that would be considered historically strong.

“In my view we just haven’t felt the effect of the rate rises yet, and the resulting recession is on its way,” said Jennifer Hunt, a Rutgers University economist. “But I admit to being very unsure — the strength of the last jobs report was quite surprising. Inflation itself isn’t a reason to think the labor market would be hurt; it is rather the interest rate rises.”

Posted in Demographics, Economics, Employment, New Jersey Real Estate | 98 Comments