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New Jersey Faces Difficult Recovery with Structural Changes, Economist Tells NJTPA

New Jersey faces a long, slow recovery from the economic downturn brought on by the COVID-19 pandemic, Rutgers University economist Dr. James W. Hughes said during a presentation at the January NJTPA Board meeting.

Like the rest of the nation, by the end of April 2020, New Jersey suffered the loss of all job gains realized over the past 10 years, he said. While the state’s economy started to recover in May, that recovery had begun to stall by the end of 2020. 

All the while, he said, life during the pandemic has accelerated structural changes throughout the economy, “added fuel to the fire” to economic disruptions. Among the changes:

  • The rapid adoption of remote work technologies is driving employers to consider a host of new work arrangements, including eliminating or reducing reliance on central offices.

  • The rapid expansion of e-commerce has led to growing failures of “brick and mortar” stores, which were already struggling to compete with online outlets.

  • Companies serving online customers are establishing new fulfillment centers close to population centers, changing land uses and adding delivery trucks to local streets.

  • As office towers in downtowns lose attractiveness, suburban work locations are benefiting, reversing recent trends.

  • While people who can work remotely are faring well, other workers—including many of the direct and indirect support staff for professionals—are suffering as part of a “k” shaped recovery that sees fortunes rising for some and falling for others.

The NJTPA will be considering these and other factors as it develops Plan 2050: Transportation, People, Opportunity, the region’s next long-range transportation plan.

Video of Hughes’ presentation, entitled “2021's Long Recovery Crawl—Coronavirus-Driven Disruptions and Upheavals Reshaping New Jersey,” can be viewed below:

 
Posted: 1/13/2021 9:57:57 AM by dveech | with 0 comments