The RegentAtlantic New Jersey Wealth Index (RANJWI) is a proprietary index that measures the health of the wealth in New Jersey. RegentAtlantic developed the index which is based on four major components: Employment, Home Values, Personal Income, and Stock Performance. It can range from 0 to 100, with values above 50 indicating that the State has experienced an above average environment for wealth creation.
The RANJWI’s value for the first quarter of 2014 is 40, indicating that the environment in the State has been close to average for wealth creation.
The financial crisis and associated recession from 2007-2009 took the RANJWI to record lows. Falling home prices, a weak stock market, high unemployment and slow income growth created a very adverse environment for wealth creation. The index hit an all-time low in mid-2012 at a value of just 17. The recovery to 40 in a relatively short time indicates a potential turnaround in our state’s fortunes. Last year, the index registered its biggest annual gain on record. With the index currently at 40, there is still room for continued improvement.
The strongest positive trend supporting the State’s wealth is stock prices. The Bloomberg State Index for New Jersey, which measures stock returns for public corporations with NJ Headquarters, has returned 23.0% per year over the past five years, materially outperforming the S&P 500, which gained 21.1% per year. Personal income rose over 1% in 2013, roughly keeping pace with inflation. New Jersey saw one of the biggest declines in unemployment in the nation, falling to 7.2% from over 9% at the beginning of 2013. The trend in New Jersey’s home prices is less encouraging. While prices have stabilized, the 1% gain seen on New Jersey homes lags the U.S. as a whole.
Components of the RANJWI