Government efforts aim to spur growth in New Jersey
When COVID struck, New Jerseyans were among those hardest hit. During the spring of 2020, the state experienced the two largest monthly declines in employment in its history. By April 2020, 750,000 jobs were lost. These losses were quickly followed by the three largest monthly gains in employment in state history. By the summer, more than 40% of jobs were recovered.
Health care has been a dependable source of employment — both pre- and post-COVID — and today it ranks as the top private-sector employer in the state. Employment in manufacturing remains strong as well. Warehousing is another sector experiencing growth in the state. New Jersey’s location along the eastern coast and adjacent to New York puts the state in an optimal position within the supply chain to be a major player due to its access to seaports, airports, railways and major highways. The growth of e-commerce has also led to the construction of more warehouses.
Phil Murphy, New Jersey’s governor, sent a message to the state’s 8.87 million residents when he signed the New Jersey Economic Recovery Act of 2020 into law earlier this year. The seven-year, $14 billion package includes incentives to fuel job growth, community partnerships and property development. Like action taken by other state governments, this program will provide tax credit incentives to create more jobs and keep companies from looking to move elsewhere. Not only is this a much-needed boost for small businesses in the state, but it is also expected to help drive New Jersey’s economic recovery and growth for the next five to 10 years.
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The legislation features several new initiatives, including the Main Street Recovery Finance Program, which provides $50 million in grants, loans, loan guarantees and technical assistance to small and micro-businesses. The bill also is expected to strengthen the state’s start-up and entrepreneur economy through the Innovation Evergreen Fund, a first-of-its-kind program that will combine state funds with private capital to support innovative new businesses.
Several innovative programs are also included in the legislation to promote growth in New Jersey’s urban centers, including the Brownfields Redevelopment Incentive, designed to facilitate the redevelopment of environmentally contaminated properties. Also included in the act is the Historic Property Tax Credit, which will incentivize the restoration of historic buildings, many of which are in New Jersey’s oldest and most distressed neighborhoods. Another component of the act, the Community-Anchored Development Program, incentivizes the construction of innovative new developments by partnering with universities, hospitals and arts and cultural organizations, and gives the state an equity stake in the development.
It may take time to see the positive effects of this act, but subtle signs that the state’s economy is rebounding are already evident.
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While the past year saw a 30% dip in leasing activity and numerous bankruptcies that affect the New Jersey retail landscape, companies such as Planet Fitness, Five Below, Amazon Fresh, Lidl, Dollar Tree, Smashburger, Jersey Mike’s and Chipotle all have chosen to expand their presence in the state in recent months. Discounted rents were one of the enticements, but alongside New Jersey’s ever-expanding population, the state remains a lure for many of these brands.