Revised state data showing that New Jersey created many fewer new jobs in 2003 than originally reported confirms that employment growth remains weak, NJBIA President Philip Kirschner said today.

"The New Jersey economy is not back on track, at least not yet," Kirschner said. "We aren't even close to creating the number of jobs we should be. The Governor and the Legislature should be very concerned that employment growth remains so weak at this stage of the economic cycle."

The NJ Department of Labor (DOL) today released the annual revision of its employment data. The revised numbers show that job growth in 2003 was weaker than originally reported. Employment in the private sector (all non-government jobs) grew by just 12,000 in 2003, a gain of one third of one percent, the DOL said in releasing its data revision. This is 17,400 less than the originally reported gain of 29,400 new private sector-jobs, a decrease of 60 percent.

Kirschner noted that this weak employment data is consistent with the findings of NJBIA's 2004 Business Outlook Survey. Only 15% of employers responding to the survey hired more workers in 2003, the lowest level since the 1991 recession year. And only 23% said they intended to hire more workers in 2004, a slight drop from the year before.

"Our members have been telling us that business conditions, while slowly improving, aren't robust," NJBIA President Philip Kirschner said. "Employers have had three very difficult years, and most of them will not commit to hiring permanent employees until business picks up strongly for six to nine months.

"Normally, at this stage in an economic expansion, New Jersey should be creating a minimum of 50,000 private sector jobs a year. We aren't even close to that goal, much less the 80,000 jobs a year the state economy produced in the latter part of the 1990s, prior to the recession."

Kirschner said that a big obstacle to healthy employment growth in New Jersey is the excessively high cost of doing business here. Economy.com, the economic forecasting service based in West Chester, PA, found New Jersey to have the nation's third highest cost of doing business, making it a higher cost state than all of its neighbors, including Pennsylvania, New York, Connecticut, Maryland, and Delaware.

"The Governor and the Legislature must take aggressive steps to counter one of the biggest obstacles to job growth in this state-the exceptionally high cost of doing business," Kirschner said.

Kirschner said there is evidence that the state's weak employment growth is tied to employers' disenchantment with state policies that are driving up these costs. In NJBIA's 2004 survey, only 28 percent of Association members said New Jersey is a good place for business expansion. Of particular concern is the state's 2002 corporate tax hike, which raised corporate tax collections by more than $1 billion, doubling them in the middle of a recession.

"This is more than $1 billion a year that New Jersey employers can't use to create new jobs or expand their businesses," Kirschner said. "It is a drag on the economy."

The tax hike also caught the attention of companies nationwide. Chief financial officers responding to a recent CFO Magazine survey said they believe New Jersey has the nation's worst tax climate, primarily as a result of the 2002 tax increase.

"The most disturbing finding of the survey was the CFOs' belief that New Jersey's tax increase has made New Jersey the least desirable state in the nation for corporate relocation and expansions," Kirschner said. "We can't afford this reputation. This will seriously harm our job growth potential."

"The Governor's proposed budget, which hits businesses with another $325 million in taxes, would be a particular burden on the State's struggling manufacturers, a sector that has lost nearly 70,000 jobs over the last three years."

With more than 21,500 member companies employing 1.2 million people, NJBIA is the nation's largest state-level employer association. For more information or to obtain an interview with Philip Kirschner, call Christopher Biddle at 609-393-7707, ext. 227.