New Jersey businesses are more confident now than they have been at any other time since the recent recession, according to a report released today by the New Jersey Business & Industry Association.
Representing what the NJBIA calls the most positive near-term outlook in 16 years, 35 percent of businesses say they expect economic conditions to improve in the next six months compared to 17 percent which say they will worsen.
In what is a slight increase for a third year in a row, 25 percent of companies feel New Jersey is either a good or very good place for business expansion, comparing to 22 percent which reported the state is a poor place to expand. In 2010, the NJBIA survey found that 52 percent of businesses had negative perceptions of New Jersey as a place for business expansion.
"In fact, four years since the depths of the recession, business confidence appears to be bouncing back to levels not seen in a number of years," NJBIA president Phil Kirschner said this morning at a news conference in Trenton.
Kirschner said this year's results were not only better than last year's, but "indicate continued improvement in the state's economy."
Nearly 1,200 businesses across the state participated in the annual survey conducted in September.
Sales played a large role in the positive outlook as 57 percent of businesses said they anticipate their sales to increase in 2014, compared to just 15 percent which expect them to decline. The same goes for profits, as 52 percent of businesses reported that they expect profits to rise in the coming year, compared to just 18 percent which say they will fall.
As for 2013, 47 percent of businesses said they've seen their profits rise, but 37 percent have reported declines.
The outlook for hiring is also on the upswing, according to the survey.
In the coming year, 26 percent of companies say they expect to hire additional employees, compared to 9 percent which intend to reduce their staff. In 2013, the 20 percent of businesses which reported hiring additional workers was met with 20 percent which cut their numbers of employees.
Wages are also expected to increase as 57 percent of businesses reported that they anticipate giving pay raises in 2014. Some 53 percent of companies reported giving pay raises in 2013.
In what the NJBIA says is the highest approval rating for a governor since the question was first asked in 1991, 75 percent of responding businesses said Gov. Chris Christie is doing a "good-to-excellent job." Christie received similar survey approval ratings of 74 percent and 73 percent in the last two years respectively.
However, one area of particular concern for businesses is the uncertainty regarding the Affordable Care Act, which was reported as the "most troublesome" problem for companies.
An overwhelming 80 percent of companies said they expect the cost of employee health benefits to rise next year, compared to just 17 percent which say they will remain even and 3 percent which claim they will decline.
Of the 80 percent which say the costs will go up, 46 percent believe they will rise by 11 percent or more.
A total of 60 percent of businesses said that overall, they expect the Affordable Care Act to have a negative impact, compared to 16 percent reporting they anticipate no impact and 6 percent which said they foresee a positive impact. A total of 18 percent reported that they were still unsure as to how the law would affect them.
Kirschner said the survey results on the Affordable Care Act represent what appears to be "tremendous confusion" for businesses.
He noted there is some concern for the 2015 outlook if the state's businesses next year are forced to contend with the effects of further implementation of both the Affordable Care Act and the recently passed minimum wage hike in addition to looming legislation on mandatory paid sick-leave requirements.
Kirschner said it would be a "tremendous mistake" for legislators to assume that the state has fully recovered from the recession because the outlook appears promising. That includes not rushing too much legislation that could have negative effects on the state's business climate, he says.
"If they're intent on pushing all that forward, that could certainly have a destabilizing effect," Kirschner said.