By Erin Banco | NJ Advance Media for NJ.com

Over the last several months, New Jersey's unemployment rate has continued to increase putting it now almost one full percentage point higher than the U.S. unemployment rate -- a split not seen since February 2015.

New Jersey's economic growth has lagged behind the rest of the country for years, according to the U.S. Bureau of Labor Statistics (BLS). But in late 2015, New Jersey's unemployment rate started to improve. Governor Chris Christie applauded the state's economic growth.

Last summer, though, the state's unemployment rate increased again, sharply departing from the national trajectory. The rate increased for nearly four months before dipping slightly in January.

Now, New Jersey's rate sits at 5.0 while the country's rate is 4.1.

Economic analysts weighed in and said the increase in the unemployment rate is concerning because it could indicate larger issue within the economy. But, they warned, while the unemployment rate is a key indicator of labor market performance, it is not necessarily a reflection of the overall health of the economy.

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What does does an unemployment rate tell us?

The unemployment rate is the percentage of unemployed workers in the total labor force. The rate only includes people who are still looking for work. So, if you're unemployed and have given up on finding a job, the government doesn't factor you into the equation.

The unemployment rate is often used as a way to discover if an economy is underperforming or to understand the health of certain business sectors.

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Did the Christie administration really cut the unemployment rate in half?

In his last address as governor, Chris Christie acknowledged that his administration had cut the unemployment rate in half.

When Christie entered office the state's unemployment rate was about 10.0 and when he left office, it was about 4.9. But the nation's unemployment rate had also decreased significantly.

So, it is tough to tell how much of Christie's policies really impacted the state's unemployment, said James Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers.

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How does N.J. compare to other states?

The U.S. economy added 200,000 new jobs in January and the unemployment rate remained at 4.1 percent-- a 17-year low. The labor market is arguably the best it has been in almost two decades.

But New Jersey is lagging behind.

New Jersey is ranked next to last in the nation for its unemployment rate, in front of West Virginia, District of Columbia, New Mexico and Alaska. Hawaii holds the number one spot for the lowest unemployment rate (2.0).

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Why should I care?

The state unemployment rate trajectory could be an indicator of a new, harsher reality for those unemployed in New Jersey, experts say.

The rate is an indicator of how difficult it is to find a job after you've lost it. Even if a state adds jobs each month, it does not mean that those unemployed are qualified for them, Hughes said. It is also an indicator of the state of New Jersey's economic health.

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What N.J.'s unemployment rate says about state's economy

If the unemployment rate continues to rise, it could be a sign of a weakening local economy, with slow growth and little spending, said Hughes.

An increasing unemployment rate can cause a ripple effect in the economy and can lead to an decrease in consumer confidence (people worrying about money and spending less).

When one person loses their job, there is one less person that will pay state and federal income taxes. And a laid off worker will cut their non-necessary spending because they have less disposable income.

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What caused the sharp split?

It is difficult to pinpoint one event or underlying stressor that caused the New Jersey unemployment rate to depart so sharply from the national trend, experts say.

One possible answer to an increasing unemployment rate: There is a mismatch between the skills employers require and the skill level of people looking for work, Hughes said.

"As the (national) labor market improves, more folks are re-joining a labor market that they fled because they thought there simply weren’t jobs for them," Hughes said.

That means that there are more people entering the workforce, many who had given up on finding a job. When the number of people in the workforce grows, the harder it is to find a job, especially one that fits your skillset.

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Dreamstime

What about wage growth?

New Jersey has an educated workforce and people are still having a hard time finding jobs, said Brandon McKoy, the Director of Government and Public Affairs at New Jersey Policy Perspective, a left-learning think tank.

And even if the unemployment rate decreases and more people find work, the wages in New Jersey are still too low, he said.

"What is the point of working if you’re still in poverty?" McKoy said. "If more people are working and the poverty rate remains the same the jobs aren’t really all that great."

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How have the number of jobs in N.J. changed?

Since April 2017, New Jersey has experienced a decrease in jobs.

New Jersey reached a maximum of 4,343,387 in April, according to the Current Population Survey, a monthly survey of households that provides a comprehensive body of data on the labor force. About 77,924 jobs have been lost in New Jersey since then.

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Should I worry?

The unemployment rate in New Jersey, and nationwide, often fluctuates. The state rate has increased since August, but it could begin to improve in the first half of 2018.The unemployment rate in New Jersey has already dipped .1 percentage point in January from 5.1 to 5.0.

"Most of the job data and unemployment data right now is based on samples," Hughes said. "They are all subject to revision. Last year we thought the job growth was mediocre and then with the revised data it was the best year we had had before the recession."

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What to expect in the future

A Rutgers economic study published in July predicts New Jersey will lag the nation in key indicators through 2026.

Slow employment growth will continue to be a drag on state output, the study said, with real GDP growing by an average of 1 percent from 2018 to 2026 (versus 2.1 percent for the nation).

Hughes said New Jersey will experience setbacks in the future.

"We were the real beneficiary of the massive suburbanization waves right after WWII to the start of the Great Recession," Hughes said. "Our core specialization and economic competence was in suburban office buildings. Now we are the weakest nationally for that."

Hughes said with more people in New Jersey wanting to live in what he calles "24/7 live and play environments", fewer are moving to the suburbs.

"NYC is booming. The Hudson waterfront is booming," he said. "We have high vacancy rates in our suburban office inventories, so we're seeing more get knocked down. It is a structural change that is hitting N.J. harder than other states."

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What can Gov. Murphy do?

Gov. Murphy has already introduced several labor policies that will help boost New Jersey's economy, McKoy said, including equal pay for equal work and paid sick leave.

Murphy campaigned on the promise that he would raise the minimum wage in the state to $15/hour but he is facing pushback from other Democrats.

"There's been an artificial deflation of wages over the last several decades. As a result, the economy is not as strong as it could be," McKoy said. "Fifteen dollars an hour its not that much money. No where in the state can you meet basic needs and make less than 15 dollars an hour."

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More about unemployment in N.J.

Christie: N.J. jobs growth rate now better than U.S.

Here are 19 big promises Gov.-elect Phil Murphy made to you during the campaign

Phil Murphy on raising N.J. minimum wage: 'We are done with this us vs. them' attitude

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Erin Banco may be reached at ebanco@njadvancemedia.com. Follow her on Twitter @ErinBanco. Find NJ.com on Facebook.