The 1,450 employers polled by the New Jersey Business & Industry Association for its 2009 outlook survey expect conditions to remain bleak for months. They say the climate is as bad as in prior recessions, and few expect to add to their payrolls soon.
The state's unemployment rate hit 6 percent in October. While that's a half-percent better than the national rate, it was the state's highest rate in five years, and a leading economist here said New Jersey could lose another quarter-million jobs before employment conditions improve.
"The state of the economy has focused the governor and the Legislature very acutely on what we need to do to provide a stimulus in the short run and long-term fixes that will help businesses when we finally come out of this slump," said Melanie Willoughby, senior vice president with NJBIA. "New Jersey has had a difficult business climate. The focus of the governor and the Legislature now on trying to deal with these problems is the silver lining in the cloud."
However, a Tax Foundation report out this fall ranked the Garden State last among the 50 states in its business climate index.
Corzine last week signed the first of what he hopes will be several pro-business stimulus bills. The bill, S-2130, extends to 20 years the amount of time businesses can carry forward net operating losses for tax purposes. The governor said the carry-over, which had been seven years, is especially beneficial for high-tech companies and pharmaceuticals, which typically make big investments upfront.
"This legislation sends a clear message to those firms: You are welcome in New Jersey, and we will work with you so we can grow and prosper together," the governor said.
While the law was cheered by industry groups as long overdue, it simply allows New Jersey to catch up with what other states in the region, and the federal government, are already doing.
Two other business stimulus bills were approved by the Senate last week and await the governor's signature.
One bill appropriates $50 million from the Surplus Revenue Fund to establish the "Main Street Business Assistance Program," which provides loans to small- and mid-sized businesses and nonprofits to encourage community investment.
Another bill provides $120 million for capital investment incentives and employment grants. One component is designed to spur hiring by providing a $3,000 grant to businesses for every new hire on the payroll for at least a year. A second component reimburses businesses 7 percent of a company's repair/renovation costs for site preparation, construction, renovations and buying machinery.
Three Democratic assemblymen have introduced a bill that protects American workers by barring the state from doing business with companies that outsource jobs overseas.
The sponsors, L. Harvey Smith and Ruben Ramos Jr. of Hudson County, and Nelson Albano of Atlantic County, said New Jersey tax dollars should not be spent on businesses that have eliminated jobs performed by Americans. The bill seeks to bar businesses that outsource jobs from receiving state contracts or grants.
Another proposal would defer implementation of New Jersey's Paid Family Leave law, which business groups vehemently opposed. One measure would delay the law for 24 months, another would delay it for a year.
If no action is taken, employers will be required to begin collecting the $100 million increase in employee payroll taxes needed to fund the program on Jan. 1, with employees being allowed to begin taking the leave on July 1.
New Jersey was the third state in the nation to enact a paid family leave law.