Chamber President says Business Community will Offer Solutions to State Leaders at a Business Summit in Atlantic City in September
High taxes/high cost-of-living remains the single biggest obstacle to a full-blown economic recovery in New Jersey, say members of the State Chamber of Commerce in the Baker Tilly - New Jersey Chamber of Commerce Spring 2015 Economic Outlook Survey.
To gauge the difficulty of luring companies to New Jersey and retaining them, the survey asked executives to identify the most significant problems New Jersey leaders should address to improve the state's business climate and quality of life. Respondents could name as many issues as they thought necessary.
About a third of respondents pointed to either high taxes or high cost of living as New Jersey's biggest issue, while 28 percent implored state leaders to fix the Garden State's roads, bridges and mass transit. Two issues (each mentioned by 13 percent of the respondents) were tied for third - the need for government to continue cutting red tape; and the need to fix the public pension system.
Companies Contemplating Leaving New Jersey
The survey asked executives if they were currently considering moving their businesses out of New Jersey. Executives at 14 of the 100 responding companies confirmed they were. Ten of the 14 blamed high taxes or high cost of living as their reason. Others cited opportunities elsewhere.
"It is no surprise that high taxes are at the top of the list," said Tom Bracken, president and CEO of the New Jersey Chamber of Commerce. "New Jersey-based corporations pay a 9.4 percent tax rate, one of the highest in the country. Despite that, some in the state Legislature last month proposed increasing the corporate tax rate again to 10.75 percent. We fought hard against it and thankfully Gov. Christie vetoed it."
Executives Remain Mostly Upbeat
Despite the state's challenging issues, business executives in New Jersey are optimistic about the future.
More than four out of 10 respondents (42 percent) said they expect the state economy to improve over the next 12 months, while only 16 percent said they expect it to worsen. This is an improved outlook from the N.J. Chamber survey results a year ago, when only 35 percent of respondents said they expected the economy to improve, while 26 percent said they expected it would worsen.
A large majority of respondents - 82 percent - said they expect their companies will either maintain or increase their staffing levels over the next 12 months. And more than three quarters (77 percent) of the respondents said they expect their companies' revenue to stay even or increase.
"There are many rewards to running a business in New Jersey, including a well-educated workforce, a second-to-none location between New York and Philadelphia, and a consumer base with one of the nation's highest household incomes," said Bob Fodera, a partner at Baker Tilly. "Businesses located in New Jersey are situated in the nation's most well-connected region in the country. It's a place many companies want to be. But they want to feel as though their issues are being heard and seriously considered by the Legislature."
Business Summit Announced
Bracken announced that the N.J. Chamber, along with a coalition of regional chambers of commerce and other business advocacy groups throughout the state, will jointly host a Business Summit at the Borgata Hotel in Atlantic City September 17 and 18, 2015, to offer specific solutions to the top issues identified by business executives.
"New Jersey offers so many advantages to companies doing business here that we should be further ahead in our economic rebound," Bracken said. "The Summit will not be about blaming anyone or looking backward. The Summit will focus on recommending solutions that can get New Jersey's economy back on track.
"Anyone doing business in New Jersey is welcome to attend and we will be inviting all of our state legislators to join us."
Bracken said a formal announcement of the Summit would be coming shortly.
What They Said
When asked to identify the state's most significant problems, here are some of the business executives' answers:
- "Small businesses are bearing the burden of all budget deficiencies."
- "There are too many layers of government."
- "State and federal governments are aggressively interfering with good business practices."
- "Stop making business the bad guy."
- "Fix the infrastructure and stop the flight of the wealthy."
Survey Details
The biannual Baker Tilly - New Jersey Chamber of Commerce Business Climate Survey is designed to measure the outlook of the state's business leaders, ranging from single entrepreneurs to CEOs of Fortune 500 companies in a wide array of fields. A total of 100 business leaders were surveyed between May 5 and June 20. Most said they are presidents and CEOs, or senior level executives.
Complete results can be found here.