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-- Economy
* Economy * Employers * Growth Companies * Venture Capital * Labor Unions * Real Estate * Transportation * Health * Law Firms 
-- Overview
Since its early colonial settlement, New Jersey's economy has evolved from its first base in farming and trade, to manufacturing and, most recently, to reliance on service and technology-based industries. The influence of private sector business ventures with New Jersey government also long has been controversial. Commencing in the 1830s, the state government's close--and often corrupt--relationship with the Camden and Amboy Railroad, which financed much of the state government's budget through its operations, led to cynics branding New Jersey as "the state of the Camden and Amboy." Toward the end of the century, the state legislature's approval of laws catering to the interests f giant corporate trusts and monopolies to attract them to legally incorporate in the state brought charges by a leading muckraker that New Jersey was a "traitor state." The state's role as a national leader in manufacturing--which evolved after the Civil War with its key location on the central railroad corridor, access to raw materials and a workforce of recent immigrants--began to erode in the latter years of the last century. In the 1970s, particularly after the spike in energy prices following the Arab oil embargo in 1973, New Jersey lost both existing and potential investment as other locations offered advantages in lower-cost labor, real estate, taxes and energy supplies, resulting in the state experiencing its highest levels of unemployment since the Great Depression of the 1930s. More recent economic trends have seen the growth of technology-based manufacturing industries in electronics, computers and medical devices, as well as a shift toward service industries such as finance and health care. -- Gross Domestic Product
New Jersey had the eighth largest economy of the 50 states in 2014, as measured by Gross Domestic Product, the most frequent measure of economic activity which includes wages and salaries, income earned by entrepreneurs and corporations and business taxes that count as a business expense. The state’s current-dollar GDP was $549.1 billion in 2014, a .4% increase from 2013 which lagged the national growth rate of 2.2%. Over the ten-year period from 2004 to 2014, the state’s growth rate also was .4% compared to 1.4% for the nation. On a per capita basis, New Jersey had $56,405 in GDP for each person in its population in 2014, the eighth highest of the states led by Alaska's $66,160 and compared to the national average of $49,469. * New Jersey Economy at a Glance, Bureau of Labor Statistics, US Department of Labor * Regional Economic Accounts, Bureau of Economic Analysis, US Department of Commerce -- Employment
In July 2016, New Jersey's labor force was approximately 4.5 million persons. The leading sectors of private employment were trade, transportation and utilities (875,000); education and health services (660,900); professional and business services (663,200); and leisure and hospitality (415,100). From 1990 to 2010, the health care industry added nearly 160,000 new jobs in New Jersey, growing at an annual rate of 2.4%; accounting for 3 of every 5 new jobs statewide since 1990, while combined annual job growth for all other industries was about 0.2%. After lagging the nation and nearby states in employment since the recession which began in 2008, the state's unemployment rate in July 2016 was 5.2%, above the federal 4.9% rate for the month. From 2000 into 2008, the state unemployment rate was below 5%, but it spiked to peak at 9.8% in January 2010 following the financial crisis which began in late 2008. Since the recession began, New Jersey has replaced about 70% of the jobs it lost; in contrast, the nation as a whole had recovered all lost jobs by June 2014. New Jersey's lagging recovery from the recession has been affected by contraction in financial services, pharmaceuticals and casino-hotels. In financial services, the 2008 financial crisis forced such major state employers as Merrill Lynch to merge with other firms resulting in massive job losses. Pharmaceuticals, a traditional leader in both the locations of executive headquarters and manufacturing facilities, has gone through a period of consolidation and mergers that has reduced employment; New Jersey pharmaceutical manufacturing employment, which accounted for one-fifth of all jobs in the sector in the US at the end of the last century, has declined so that in 2015 it was less than 10% of the jobs in the nation. Casino-hotels have experienced the most dramatic reversals, with direct employment--which once peaked at over 40,000 jobs--was cut by a third over the 2012-2016 period with the closing of four of the City's 12 casinos, resulting in an unemployment rate in Atlantic City in 2016 that was twice the level of that for the state as a whole. Overall, however, an annual state report on the economic impact of tourism throughout the state concluded that in 2014 the tourism industry generated $2.1 billion in economic impact, a 3.8% increase over 2013, although noting that there had been a loss of 7,000 jobs of the total of nearly 316,000 among all tourism-related employers. * New Jersey Economy at a Glance, Bureau of Labor Statistics, US Department of Labor * Bureau of Labor Statistics, US Department of Labor * Economic Impact of Tourism in New Jersey 2014, Tourism Economics -- Largest industries
The largest industry in New Jersey in 2014 was finance, insurance, real estate, rental, and leasing. This industry accounted for 24.8% of New Jersey GDP, compared to 20% for the nation, and had a 0.8% real decline from 2013. The second largest industry was professional and business services, which accounted for 15.3% of New Jersey GDP, compared to 12% for the US, and had 1.0% real growth. The largest contributor to real GDP growth in New Jersey was nondurable goods manufacturing, with computer and electronic manufacturing comprising approximately one-fourth of all manufacturing output in 2013. * Regional Economic Accounts, Bureau of Economic Analysis, US Department of Commerce -- Personal income
In 2015, New Jersey had a per capita personal income of $59,782, according to the annual report released by the US Department of Commerce in March 2016. This ranked third in the United States behind $69,772 for Connecticut and $61,032 for Massachusetts, with an average for all states of $47,669. The 2015 PCPI was an increase of 4% from 2014, below the national growth rate of 4.4% and ranking 24th among all states. For the ten-year 2004-2014 period, the compound annual PCPI growth rate was 2.8 % for New Jersey compared to the national rate of 3%. For tax year 2013, individual taxpayers in the state reported just under $340.8 billion in total income, according to the Internal Revenue Service. Median household income over the 2009-2013 five-year period was $71,629 in New Jersey, second only to Maryland's $73,538, according to the US Census Bureau's American Community Survey. The national average for the period was $53,046. The highest median household incomes among counties were reported for Hunterdon ($106,143), Somerset ($99,020) and Morris ($98,663), with all three counties ranked among the top 15 counties in the US. The lowest incomes were in Cumberland ($50,070), Atlantic ($54,235) and Essex ($55,095). The average annual salary in New Jersey is $52,800, which ranks seventh among all states behind leading Massachusetts at $56,410, and is 14% higher than the national average of $46,440. The median salary (50% earning more, 50% earning less) in New Jersey is $40,250. As in the nation, the issue of income inequality has increasingly become a focus of public policy debate. From 2000 to 2013, there was a 4.2% increase in New Jersey gross domestic product per capita while median household income declined by 5.9%. When adjusted for inflation, median household income in the state in 2013 remained about $4,500 a year below the level it was at before the most recent recession and less than the level it was at in 2000. * State Personal Income 2015, Bureau of Economic Analysis, US Department of Commerce * American Fact Finder, US Census Bureau * State and County QuickFacts, US Census Bureau * Statistics of Income, Internal Revenue Service -- Poverty
In 2014, the national poverty rate was 14.8%, representing 46.7 million people in poverty living below the federal poverty level of $24,000 for a family of four. In New Jersey, the rate was 11.1%, down from 11.4% in 2013, but still higher than the 8.7% rate in 2004. Nearly one million people lived in poverty in the state, an increase of almost 250,000 people in the past 10 years, according to 2014 Census data. The rate remains well above levels since the last major recession of the 1970s; in 2007 the rate was 8.6% and in 2000 it was 7.9%. Poverty levels for minorities are significantly above the state average; about 20% of African-American and Hispanic New Jerseyans live below the federal poverty level. Just under 16% of children under 18 were living in poverty in the state in 2014. Camden is the poorest city in the nation, with nearly 32,000 residents, or 65% of its population, living below the poverty line. Poverty levels were above 50% in Passaic, Lakewood, Paterson, Trenton and Newark. Six counties--Passaic, Cumberland, Hudson, Essex, Atlantic and Salem--had more than 30% of their population in poverty in 2011, according to an annual survey conducted by Legal Services of New Jersey. * Poverty, US Census Bureau * Poverty Benchmarks 2014, Legal Services of New Jersey * State of Poverty, Poverty USA |
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-- Government subsidies and incentives
New Jersey provides various subsidies and tax credits through several programs, with most of them administered through the state Economic Development Authority created in 1974 by Governor Brendan Byrne. The amount of these subsidies has substantially increased in recent years; a study by the nonprofit New Jersey Policy Perspective found that of the $5.4 billion in tax subsidies and credits awarded since 1996, $4 billion of that total was approved since 2010. The report also found little evidence that the incentives had produced positive economic returns or influenced expansion or site decisions; that the program had shifted from its original goal of creating new, permanent jobs to preventing the loss of jobs "at risk" of moving out-of-state; that the aid had helped companies move from one New Jersey town to another. * New Jersey Economic Development Authority * New Jersey's Surge in Business Tax Subsidies Reaches New Heights, June 2014, New Jersey Policy Perspective Economy * Economy * Employers * Growth Companies * Venture Capital * Labor Unions * Real Estate * Transportation * Health * Law Firms |