New Jersey is now in a recession and it may get worse, Moody’s analyst says

🔴 Moody’s Analytics chief economist says New Jersey is now in a recession.

🔴 Business leaders say the downturn confirms what they’ve long warned.

🔴 Despite the gloom, Moody’s upgraded New Jersey’s credit rating last month

After years of recession fears, it appears New Jersey may finally be experiencing an economic slowdown.

The Garden State is in a recession, according to Moody's Analytics Chief Economist Mark Zandi.

New Jersey and 21 other states, plus Washington, D.C., are experiencing an economic slowdown and persistent job losses, Zandi said to MarketWatch.

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It's unclear what metrics were used to decide that New Jersey was in a recession. There wasn't anything specific about New Jersey in his comments, which pointed to national economic policy, such as President Donald Trump's tariffs.

New Jersey 101.5 has reached out to Moody's for comment.

Business leaders say slowdown confirms their fears

Zandi's comments were welcomed by Michele Siekerka, president and CEO of the New Jersey Business & Industry Association.

Siekerka said it's been clear to the business community that New Jersey has been lagging behind the region and the nation.

"It is disappointing yet affirming to see an economist point out that the data shows that we should be concerned about a possible economic slowdown in New Jersey. Policymakers must now focus on support for our job creators. How else do we recover from a state unemployment rate being among the worst in the nation and the worst in our region?” Siekerka said.

New Jersey had an unemployment rate of 5.0% in August, according to the U.S. Bureau of Labor Statistics. That places it at the 7th worst of the 50 states and Washington, D.C.

Credit rating upgrade sends mixed economic signals

Despite the negative assessment from Moody's Analytics' chief economist, New Jersey's credit rating was recently upgraded.

The Sept. 17 upgrade came from Moody's.

Moody's said at the time that New Jersey's "recent trajectory of strong economic performance compared with regional peers" would support the state during disruptive federal policy changes.

It's unclear if Moody's used different factors than its chief economist to determine the strength of New Jersey's economy.

Rutgers expert says it’s too soon to call it a recession

It's not yet time to sound the alarm bells, according to Marc Pfeiffer. Pfeiffer is the associate director of the Rutgers-New Brunswick School of Planning and Public Policy.

"We may start seeing signs of a recession, but that doesn't mean we're in a recession. The economy is constantly flowing, changing. I don't see us at the moment being in recession. But there clearly is potential for that," Pfeiffer said.

He says there is a risk of a recession in the future, and whoever wins November's governor's race will need to keep a keen eye out for recession indicators.

The next administration may need to make immediate changes in the state budget to reduce spending if recession fears come to pass, Pfeiffer said.

As of mid-September, the number of layoffs in New Jersey tallied more than 9,700.

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