If people keep fleeing NJ, will state go completely broke?
A new poll finds that 44% of New Jerseyans are planning to eventually leave the state because of high property taxes and the high cost of living. Economists and business leaders say this trend could be devastating to businesses and the economy — and make the tax situation even worse.
Tom Bracken, president and CEO of the New Jersey Chamber of Commerce, said the exodus “takes away from the qualified workforce that we need to allow businesses to grow [and] the outmigration of the retirees takes away the people who in their retirement years would be here spending money and helping our economy.”
Bracken said the state would also take a hit in tax revenue.
“That’s going to have the ripple effect of putting pressure on being able to pay for the programs that are needed to sustain the state," he said.
Rutgers University economics professor James Hughes agrees the trend is troubling.
He said we already know from U.S. Census Bureau data that every day New Jersey has a net migration loss of 173 people, which means more people are moving out of New Jersey to other states than moving in, and “that’s a lot of income that’s being lost for the state.”
He said the outmigration pattern hurts the state economically in several ways besides revenue loss and loss of skilled workers. The pattern means there is less demand for new housing, which hurts the construction industry.
With a significant percentage of the younger workforce leaving, corporate growth in New Jersey becomes stagnant because companies go where the workers are, Hughes said.
Hughes added that New Jersey continues to mount debt even as revenue continues to drop because of outmigration, and that spells serious trouble.
“We’ll probably kick the can down the road till we get to the edge of the cliff, but before we’re pushed over the cliff some accommodation is going to have to be made to avoid the disaster," he said.
Bracken pointed out that the state should be drawing in more people because of the quality of its education system and its location between the New York and Philadelphia metro areas being "second to none." Yet so many people are leaving.
“There’s something wrong that needs to be addressed, and needs to be addressed quickly," he said. “Something’s got to be done to reduce the property tax, and really start to look at the overall tax issue.”
You can contact reporter David Matthau at David.Matthau@townsquaremedia.com