NJ’s road to recovery: How long will it take?
New Jersey has started down the road of reopening and recovery from the COVID-19 pandemic, but how bumpy will the trip be? How long will it take for the state to get back on its feet? How much economic pain will be inflicted on the typical Garden State family?
According to Rutgers University economist James Hughes, these are questions that don’t have clear answers yet. He said in the near term we can expect some progress.
“It’s entirely possible that the job losses could reach the bottom in the 3rd quarter of this year and then we’ll start to see a gradual turnaround,” he said last week.
He noted Wall Street is an uncertain metric but “the stock market is forward-looking and the positive rebound that it’s had over the past month does suggest that a lot of investors are looking forward to a turnaround in a more positive future.”
Hughes said the state will need billions of dollars to make up for lost revenue in the coming months and it’s unclear whether property and other taxes will have to be raised or if state leaders will borrow billions to keep things running.
About 833,000 New Jersey workers have lost their jobs in March and April of this year because of the pandemic. It's unclear still whether these job losses will be temporary.
He said in some respects, the pandemic has added fuel to the fire of change by accelerating e-commerce at the expense of retail stores.
Hughes said an important unknown factor in the equation is consumer confidence once the pandemic restrictions begin to get lifted.
“Are people going to be comfortable going to restaurants? Do they need that social interaction?" he said.
“Even if we have a turnaround this year, we are very deep in the economic hole and it’s going to take us a long time to get out of it,” he said.
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