How healthy is Revel?

From The Record:

Atlantic City’s main casino union wants state gambling regulators to determine whether the city’s newest casino is financially stable.

The union cites Revel’s disappointing performance in its first four months of operation and claims the $2.4 billion casino owes $27 million in unpaid bills to contractors and vendors.

The casino received a significant amount of state money to keep it moving forward and allow it to open. The question is whether the Revel itself is a problem or is part of a larger systemic problem in the state’s gambling mecca.

Another uptick in N.J. unemployment rate

The state’s unemployment rate ticked up .2 percentage points in July, to 9.8 percent, just as the governor is preparing to tout a New Jersey economic miracle at the Republican convention.

According to the Department of Labor, the state has added 40,200 nonfarm jobs over the last year, but it lost 12,000 jobs in July, with five sectors leading the way:

  • professional and business services lost 3,900 jobs, “due to cutbacks in the administrative support/waste management and remediation segment (-4,600).”
  • manufacturing lost 3,000 jobs
  • construction lost 2,700
  • financial activities lost 400 jobs
  • and information lost 300 jobs.

“The national economy has been sluggish and, realistically, we can’t be exempt.  Given the national softness and the strength of our job gains in May and June some fallback was likely,” Charles Steindel, chief economist for the state Department of Treasury, said in a press release. “Still, New Jersey’s labor force participation rate and the percentage of our population who are employed remain above the national averages. Considering we have seen job growth in 9 out of the past 11 months, we anticipate that job growth should resume and start to put some downward pressure on unemployment.”

But New Jersey’s rate grew faster than the national rate, which is now 8.3 percent.

Gordon MacInnes, president of New Jersey Policy Perspective said in an interview earlier this week for a different story, before the report was released, that much of the May and June increases touted by the administration were from seasonal employment and masked the problems the state continues to face.

“With the blow up (of the telecommunications and pharmaceuticals industries) we’ve lost a lot,” he said. “In May, with the biggest one-month of job additions, it was driven by seasonal boardwalk jobs and the Revel casino jobs. We still lost 4,800, approximately, in other jobs, and in terms of gross income we may have held even or lost a bit.

“That is a pretty good indicator of our problems.”

The full press release follow:

TRENTON, August 16, 2012 – While the long-term employment trend continues to be positive, preliminary numbers show that employment in New Jersey shifted lower in July and the unemployment rate edged upward. However, overall private sector employers in the Garden State have added 79,000 jobs since February 2010, which was the low point of private sector employment during the recession.

Over the year, July 2011 – July 2012, total nonfarm employment in New Jersey increased by 40,200 jobs.

“The national economy has been sluggish and, realistically, we can’t be exempt.  Given the national softness and the strength of our job gains in May and June some fallback was likely,” said Charles Steindel, Chief Economist for the New Jersey Department of Treasury. “Still, New Jersey’s labor force participation rate and the percentage of our population who are employed remain above the national averages. Considering we have seen job growth in 9 out of the past 11 months, we anticipate that job growth should resume and start to put some downward pressure on unemployment.”

The state’s unemployment rate moved up in July, by 0.2 percentage point, to 9.8 percent, remaining above the national rate, which also edged up, by 0.1, to 8.3 percent in July. Preliminary estimates indicate total nonfarm wage and salary employment in New Jersey decreased in July, down by 12,000 jobs, to a seasonally adjusted 3,899,600, as measured by the United States Bureau of Labor Statistics (BLS) through its monthly employer survey. Job loss was registered in both the private (-7,100) and public (-4,900) sectors of the state’s economy.

The job gain from April to June was still the largest two-month gain witnessed in 12 years. However, based on more complete reporting from employers, previously released June estimates were revised lower, down by 2,600 jobs, to show an over-the-month (May – June) total nonfarm employment gain of 7,300 jobs. Preliminary estimates indicated an over-the-month gain of 9,900 jobs

In July, job loss was recorded in five of ten private industry sectors; four recorded gains while one was unchanged. The industry sector with the largest drop was professional and business services, which fell by 3,900 jobs, due to cutbacks in the administrative support/waste management and remediation segment (-4,600). Other industries that registered larger losses included manufacturing (-3,000) and construction (-2,700). The decline in manufacturing was due to contraction in the nondurable goods component (-3,500) while the loss in construction is reflective of a longer-term trend that has seen employment in this sector fall by 8,200 over the past year. Smaller losses occurred in financial activities (-400) and information (-300).

The largest over-the-month gain occurred in the trade, transportation and utilities sector (+1,600), mainly due to advances in the transportation and warehousing (+1,900) and wholesale trade (+800) subsectors. Smaller gains occurred in other services (+600), education and health services (+500), and leisure and hospitality (+500).

In July, public sector employment was down by 4,900 due to the trimming of payrolls at all three levels of government: federal (-300), state (-2,400) and local (-2,200).

Over the month, the unadjusted workweek for production workers decreased 0.5 hours to 41.2 hours, average hourly earnings were higher by $0.39 to $19.57 and weekly earnings rose by $6.47 to $806.28. Compared to July of last year, the unadjusted workweek increased by 0.8 hours, average hourly earnings increased by $0.67, and weekly earnings were higher by $42.72.

NJ Spotlight: Low-Income Workers Feel the Pinch of Tax Credit Cut

Cut in earned income tax credit hits low-income workers hard.

 

The governor, as part of the budget that ended in 2011, reduced the payment by 20 percent, which resulted in a loss of $300 in each of the past two years for Rosado.

 

Overall, according to an analysis by New Jersey Policy Perspective, a liberal think tank based in Trenton, nearly half a million families — 1.5 million individuals — lost a total of $100 million in tax credits the past two tax years, or an average of $200 per family.

Stagnation, stagnation, stagnation

July’s job numbers appear better than June’s, based on today’s jobs report from the U.S. Department of Labor, but unemployment ticked upward — another ominous sign that the economy is far from any kind of real recovery four years after the near-collapse of the banking system.

The numbers:

Total nonfarm payroll employment rose by 163,000 in July, and the unemployment rate was essentially unchanged at 8.3 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in professional and business services, food services and drinking places, and manufacturing.

In June, just 64,000 jobs were added.

Economists quoted by The New York Times expressed resignation — the report was not a surprise, perhaps not as bad as it could be, but we should not expect much improvement for the rest of the year.

“It’s a lot better than we’d been seeing in the last few months, but it’s still short of the kind of job growth we were seeing at the beginning of this year,” said Paul Ashworth, chief United States economist at Capital Economics.

As for the pace of hiring through the rest of the year, he said, “I think this is about as good as it’s going to get.”

For context, the economy now produces as many goods and services — more, in fact — than it did before the downturn officially began in December 2007. But it does so with almost five million fewer jobs.

And the rate at which the economy has been adding jobs in the last few months is just barely fast enough to absorb the growth in the labor force.

“In the weakest recovery since the Great Depression, nearly the entire reduction in unemployment since October 2009 has been accomplished through a significant drop in the percentage of adults participating in the labor force — either working or looking for work,” said Peter Morici, a professor at the University of Maryland.

The suicide of a toll collector

A New Jersey toll collector has committed suicide and the union representing his fellow workers says pay cuts were the trigger. According to NJ.com, Patrick Kelly, 58, On July 16, Kelly, 58, shot himself on July 16. Kelly had been working two jobs since the first of two $8,000 pay cuts took effect and was growing increasingly worried with a second pay cut pending, the union said.

“It shouldn’t have happened,” Franceline Ehret, president of the collectors union, International Federation of Professional and Technical Engineers Local No. 194, said Tuesday during the Turnpike Authority’s monthly meeting. “You didn’t need to make such a high demand of our toll collectors.”

After the authority threatened to privatize toll collection last year, toll collectors agreed to a two-year contract that cut their pay nearly 25 percent by the end of the contract, from about $65,000 to $49,500.

“I hope what Pat Kelly did, God forbid, doesn’t become a trend,” Ehret said. “We know that our toll collectors are facing extreme hardships thanks to these pay cuts. Your loyal employees deserve better. … You can do the right thing now. You can give our toll collectors back this last $8,000 pay cut.”

The state’s transportation commissioner, Jim Simpson, responded by calling the union’s accusations “tasteless.”

“First of all, condolences to the Kelly family,” said Simpson, who chairs the Turnpike Authority. “I just felt that (Ehret’s) timing was really off. Here we had this really tragic employee suicide, and to throw it on the backs of the Turnpike Authority is not appropriate.”

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