A combined 56% of the New Jersey Business and Industry Association’s almost 900 members forecast a looming recession is likely in the next couple years, according to a poll shared at the association’s annual conference Wednesday.
“There is much more negativity in this survey than we’ve seen — I’m here five years,” said president and CEO of the association, Michele Siekerka.
Forty-percent see NJ’s economy getting worse in 2020, with comments from survey-takers ranging from “Looking to sell business and leave state” to “I think it is good but fragile.”
“There are businesses who say positive things. But, if I have to rank the comments, the overwhelming majority are negative,” said Siekerka. “And I just think that the numbers express what the sentiment is.”
The association’s survey includes worrisome details about how businesses would handle a fiscal slowdown: 62% would reduce expenses, 35% would postpone hiring and 32% would postpone raises.
NJ Spotlight’s John Reitmeyer sees potential trouble ahead for Garden State workers.
“If New Jersey businesses are concerned about a recession coming and they pull back, they retrench, they stop hiring, they stop giving raises, then you would be concerned about there being an effect, almost, of a self-fulfilling prophecy, in the sense just the concerns about a recession tamp down economic activity and slow down the economy,” said Reitmeyer.
The survey also asked business owners about legalizing recreational marijuana, an issue that could end up on next November’s ballot. 56% don’t think it’ll be good for New Jersey’s economy, while 44% do.
They’re worried about workplace safety (84%), productivity (75%) and chronic absenteeism (45%). But, legal weed advocates say that’s understandable.
“It’s just challenging in terms of developing the right policies,” said Bill Caruso, founder of the group New Jersey United for Marijuana Reform. “And you know, businesses sometimes are stuck in their ways and don’t want to have to accommodate those challenges. But nevertheless, other states are doing it, and they’re doing fine.”
Businesses reported strong profits in 2019, but many complained bitterly about state-enforced costs and mandates. Some included year two of the five-year $15 minimum wage phase-in, with more than half of respondents saying it will impact their businesses (51%). Of those, 32% expect to raise prices, 21% will reduce staff and 15% will reduce benefits.
“Not just $15 minimum wage, but paid sick leave, expanded family leave, those are all costs to a business,” said Siekerka. “They have to assume those costs. If you have those costs — in addition to looking at a recession — unfortunately, where’s it going to hit? It’s going to hit in the workforce.”
“These scare tactics of these self-reported surveys are, it’s really a shame that they’re putting that out as if it’s fact,” said Imani Oakley, legislative director of the progressive political group New Jersey Working Families Alliance.
The organization, which lobbied hard for the minimum wage and other benefits, called the survey skewed, claiming a $15 minimum wage shouldn’t trigger a draconian response.
“New York actually about two weeks ago just released a report that showed there was barely any difference in the employment rate,” said Oakley.
For New Jersey businesses, the top two most worrying issues are property taxes and the cost of doing business.
Assembly Minority Leader Jon Bramnick commented, “As people flee our state because of high taxes, the Governor’s single-track, radical agenda makes New Jersey less attractive to residents and job creators.”
The association, meanwhile, wants state government to make a promise — no new costs or mandates over the next couple years — to avoid ringing in a recession in 2020.
