New Jersey’s unemployment rate fell to 4.3% in August as more residents entered the labor force and household employment increased, but employers reported 1,700 fewer payroll jobs than in July. The latest federal data therefore show an improving headline rate alongside continued weakness in the separate employer survey.

The state’s seasonally adjusted labor force grew by about 7,600 people in August, reaching 4.918 million. Employment measured through the household survey rose by roughly 11,000, while unemployment fell by about 3,600, to 212,700. That combination lowered the unemployment rate from 4.4% in July to 4.3% in August.

The rate has declined for four consecutive months after standing at 4.8% in April. It moved to 4.7% in May, 4.5% in June and 4.4% in July before the August improvement, according to the Federal Reserve Bank of St. Louis time series. The national rate was 4.1% in August, the Bureau of Labor Statistics reported in its state summary.

Employer payrolls, however, moved lower. Total nonfarm employment declined from 4.361 million in July to 4.360 million in August, a decrease of about 1,700 jobs, according to the industry table. The level was also 0.2% below August 2025, indicating that the monthly dip came within a labor market that has been broadly flat to slightly smaller over the year.

Professional and business services recorded the largest monthly decline among major sectors, losing about 3,500 jobs. Government payrolls fell by 1,900, education and health services by 1,400, financial activities by 200, manufacturing by 100 and information by 100. Those losses were partly offset by gains of 3,400 jobs in leisure and hospitality, 1,000 in construction, 600 in trade, transportation and utilities, and 500 in other services.

The annual pattern was similarly uneven. Education and health services remained the strongest large sector, up 2.9% from a year earlier, while government was 0.5% higher. Information employment was down 4.3% over the year, construction fell 2.3%, leisure and hospitality declined 1.5%, and manufacturing was 1.2% lower. Professional and business services and financial activities were each down 1.1%.

The household and payroll figures are not directly interchangeable. The unemployment rate is derived from a household-based model, while the payroll count primarily reflects an employer survey. The Bureau’s methodology guide notes that the series measure different groups and can diverge in a single month, particularly before preliminary data are revised.

For New Jersey, August suggests that labor-force participation and resident employment strengthened even as establishment hiring remained restrained. The growing labor force distinguishes the state’s falling unemployment rate from a decline driven simply by people leaving the workforce. Still, the annual payroll contraction and losses across several office-oriented sectors show that the improvement is not yet broad-based. Future revisions and September data will determine whether employer payrolls stabilize.