The past months have been marked by unprecedented economic uncertainty – globally, nationally, and right here in New Jersey. Businesses thrive when they can plan for the future with confidence, yet today’s economic climate is inherently unpredictable. From inflationary pressures to tariff wars, executives across industries are grappling with challenges that make long-term investment and expansion difficult.
In short, there’s an old truism: Uncertainty stifles prosperity.
That’s why Gov. Murphy’s proposed $58.1 billion state budget – the largest in New Jersey’s history – is so concerning. Instead of fostering an environment where businesses can grow, this budget injects more uncertainty at a time when we need stability and a clear path toward economic expansion. Rather than prioritizing pro-growth policies, it continues a trend of record spending without sufficient investment in the business community.
Consider this:
- Not one additional dollar is allocated to agencies directly supporting business growth, such as the New Jersey Economic Development Authority, the Business Action Center, and Small Business Development Centers.
- The Main Street Recovery Fund, a critical resource for small businesses, was cut by over 66%, leaving just $9 million – a paltry sum for a state of New Jersey’s size.
- The budget imposes new tax and fee increases, including an online gaming tax hike from 13% to 25% and a new $2-per-truck fee on warehouse deliveries – both of which will have ripple effects on our economy.
- The plan also increases taxes on property sales over $1 million, landline and cellphone bills and cannabis purchases – a burgeoning industry in the state.
In October, the governor created a New Jersey Economic Council to “facilitate the identification and promotion of economic opportunities for New Jersey” and "to attract, expand and retain business, development and employment in New Jersey." This budget does not support those efforts, and, in fact, it undermines the main goals of the council.
Where does this leave us?
A recent survey by the New Jersey Society of CPAs found that 80% of certified public accountants believe this budget will harm New Jersey’s economy in the long term. Many emphasized the need for cost-cutting measures and lower corporate taxes to make New Jersey a more attractive place to do business.
New Jersey is not alone in its struggles. Nationally, small business confidence is at its lowest point in years, with only 12% of small business owners telling the National Federation of Independent Business that now is a good time to expand. On the federal level, uncertainty looms over tax policy – if Congress does not extend the pro-growth provisions of the 2017 Tax Cuts and Jobs Act, businesses and families alike will face higher taxes and even greater instability. Making those provisions permanent is essential to maintaining economic momentum.
Back to New Jersey – this proposed budget, like many before it, fails to address our long-term structural deficits. Over the past eight years, state spending has surged by more than 65%, yet economic growth has not kept pace. Businesses are looking for signals that New Jersey is serious about fostering a competitive economic environment. Instead, they see more spending, more taxes, and more uncertainty.
Legislative budget hearings begin on March 19, and a final budget must be approved by the Legislature and signed by the governor by June 30. Our New Jersey Chamber of Commerce lobbyists will be advocating on behalf of our member companies, but we need your voice, too. I urge you to contact your legislators and remind them that New Jersey’s business community deserves better – policies that encourage investment, job creation, and economic certainty, not a continuation of policies that make our state less affordable and less competitive.
New Jersey has tremendous upside economic potential. However, we need greater understanding, encouragement and assistance from the Legislature to begin our economic revival.
This message was originally published in ROI-NJ