NJ’s Slow Economic Start in 2023

By Kyle Sullender, Executive Director, Focus NJ On Aug 1, 2023

Like much of the Northeast, New Jersey followed a strong 2022 with a slow economic start in 2023. Real Gross Domestic Product (GDP) grew by an annualized rate of just 1% in Q1 of 2023, according to preliminary figures released by the Bureau of Economic Analysis (BEA) in June.

GDP by Quarter: New Jersey’s economy grew by 2.6% in all of 2022, making the Garden State the 13th fastest growing economy last year. However, this most recent release marks the second consecutive quarter in which New Jersey’s growth has trailed that of the nation overall. In Q4 2022, the state’s real GDP grew by 1.1% compared to the nation’s overall growth of 2.6%. In Q1, the US economy grew by 2% compared to New Jersey’s 1%.

Nationally, New Jersey’s first quarter ranks 38th in terms of growth, and while the state trails most of its closest neighbors, it is not far behind. States like New York (34th), Delaware (37th), Maryland (43rd), and Connecticut (45th), also ranked near the bottom of the pack. Pennsylvania (24th) and Massachusetts (19th) were outliers in the region in terms of their place in the rankings.

Largest Industries as % of GDP: New Jersey’s largest industry as a percentage of total GDP in Q1 was real estate and rental leasing, accounting for approximately 14.2% of total GDP. This industry remained largely unchanged from Q4 2022 to the start of 2023, contributing just 0.01 percentage points to the state’s overall 1% growth.

The professional, scientific, and technical services sector (11.7%) was the second largest industry, followed by government & government enterprises (9.4%), manufacturing (8.8%), healthcare and social assistance (8.8%), and wholesale trade (8.4%). All other industries in the state accounted for 32.6% of New Jersey’s GDP in 2020, according to a Focus NJ analysis of US BEA data.

Economic Tracking: To help bring up-to-date information to the public, Focus NJ tracks these and other measures of New Jersey’s economic performance on our website at focusnj.org/economic-tracker. The interactive dashboard is updated frequently to reflect the latest economic figures from the Census Bureau, Bureau of Labor Statistics, BEA and others. The dashboard is fully interactive and allows for comparisons between states as far back as 2018.

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