In the annual survey of New Jersey businesses conducted under the spotlight, most respondents said they were able to maintain or grow their workforce and raise wages in 2022, despite concerns about inflation and other pressures.
The results of the statewide survey, which is conducted annually by the New Jersey Association of Business and Industry, also showed that in 2022, many businesses increased sales and maintained or increased profits.
But New Jersey business leaders also remain concerned about regulatory hurdles and taxes, among other ongoing challenges, according to the latest survey — conducted as the state itself is on par with tax revenue.
“This has been a year of historic spending and budget surpluses, but no comprehensive business relief, and our businesses have noticed,” said Michele Cicerco, NJBIA president and chief executive officer.
In particular, the impact of property taxes on New Jersey businesses remains a major concern, Sicerka said, more than 60% of respondents said they plan to pay higher property taxes next year.
Almost 30% said they would have to cut staff if inflation stayed the same or worsened over the next year.
Gov. Phil Murphy and lawmakers created a new state-funded property tax credit program called Anchor earlier this year to help homeowners and renters. But nothing new has been proposed to help businesses, which also bear a large share of New Jersey’s overall property tax burden, she said.
“It sends a strong signal to companies that they don’t have the support they need in Trenton,” she said.
In all, nearly 470 business owners and executives submitted responses to this year’s survey, which NJBIA calls its annual Business Outlook Survey. According to the Trenton-based organization, this year marks the 64th year in a row that such a statewide survey has been conducted.
What the survey says
Some key takeaways from this year’s survey: Nearly 77% of respondents said they would increase their pay in 2022, up 5% from a year earlier.
More than 50% of those surveyed also said they had enjoyed an increase in sales this year. This is 8% more than a year earlier, according to the results of the survey. And 59% of respondents indicated that they were able to either maintain or increase their income from last year.
New Jersey’s unemployment rate was near historic lows in the final months of 2022; nearly 20% of respondents said their company had increased employment over the past year.
In recent weeks, Murphy, a Democrat, has also touted New Jersey’s strong job market, including the state’s unemployment rate, which remains below the national average.
The shape of things to come
Looking ahead, nearly 10% of respondents said they expect employment at companies to decline next year, while another 61% said they expect employment to remain “about the same” in 2023.
Meanwhile, nearly 30% said they would have to cut staff if inflation stayed the same or worsened next year. And 45% said that inflation has already seriously affected them this year, while another 48% reported that inflation has moderately affected their business.
According to the survey results, the overall cost of doing business in an expensive state like New Jersey drew the highest number of responses as a top concern for businesses.
Supply chain issues following the COVID-19 pandemic were also a major concern, with more than 80% of respondents reporting problems due to delays and other supply chain issues compared to previous years.
When it comes to the state’s broader economic outlook, the survey results show a generally pessimistic view of the conditions ahead for New Jersey businesses next year.
More than 50% of those surveyed said they expect New Jersey’s economy to worsen in the first six months of 2023, compared to just 16% who expect it to improve.
Another 56% said they expect the national economy to be moderately or significantly worse in the first six months of the new year.
Cost problems
In addition to property taxes, other key concerns identified by New Jersey business owners and managers this year included health insurance costs and the availability of skilled labor. But the overall cost of doing business in an expensive state like New Jersey drew the highest number of responses as a top concern for businesses, according to the survey.
On the general issue of affordability, which has become a key buzzword in Trenton in recent years, 75% of those surveyed said public policymakers have not done enough in the past year to address specific concerns about “business affordability.”
About 19% said they would like a business tax cut.
What’s more, only 18% of those surveyed said New Jersey is affordable for business. That compares with 46% who said New Jersey was somewhat inaccessible for business this year, and another 36% who said it was “not at all accessible for business.”
When asked to name the main way the state could make things more affordable for businesses, 19% said they would like to see business taxes cut. Cutting income and property taxes was the second most popular answer, with both options receiving 17% support. Other notable responses included reductions in labor regulations, insurance costs, and state and local fees.
