Attention: State House, Business Editors
New Jersey manufacturers that invest in new equipment or upgrade their facilities to increase their competitiveness would get a financial helping hand under an Assembly bill scheduled for a vote May 18 in the Assembly Commerce and Economic Growth Committee, NJBIA said today.
The bill, A-1283 (Manzo), would provide manufacturers with a tax credit equal to 20 percent of the total cost of new equipment or the renovation, expansion or upgrade of a manufacturing facility. The credit would be applied to a manufacturer's Corporation Business Tax (CBT). The bill is one of the key items on NJBIA's Manufacturing Counts! Campaign Agenda for Manufacturing Renewal in New Jersey.
“This measure cuts right to the heart of the biggest challenge New Jersey manufacturers face—the high cost of doing business in this State,” NJBIA President Philip Kirschner said. “Enacting this bill would do much to level the playing field for the State's manufacturers. It's time for New Jersey to show how serious it is about saving high paying manufacturing jobs and bolstering a sector that has been hit hard by low cost competition in other countries and other states.”
“In today's competitive business world where globalization has brought about dramatic changes to industry, New Jersey manufacturers must constantly innovate and improve just to keep up,” Kirschner said. “This measure would give them the financial edge they need to do that and remain here.”
Kirschner said the measure addresses a growing concern facing New Jersey's economy: retaining the high-paying manufacturing jobs.
From 2001 through 2005, nearly 100,000 manufacturing jobs vanished from New Jersey , almost one-fourth of the total number manufacturing jobs in existence at the time. Most of the losses came as companies moved operations to other states with lower costs of doing business, scaled back the work being done in New Jersey or shut down their New Jersey plants altogether.
In spite of these job losses, manufacturing continues to play an important role in New Jersey 's economy. Manufacturers directly employ 321,000 production workers, support another 171,000 jobs in other industries, and pay an average annual wage of $57,220 , which is $11,068 more than the average wage paid by all private-sector employers in New Jersey.
What's more, manufacturers generated $45 billion in economic output in 2004, representing 11 percent of New Jersey 's Gross State Product. Manufacturing also uses more intermediate goods and services than other industries, generating an additional $1.37 in economic output for every $1 worth of final product.
NJBIA kicked off its Manufacturing Counts! Campaign in June 2004 to raise awareness about the economic benefits of a strong manufacturing sector, call attention to the challenges confronting New Jersey's goods producers and push for State policies that will support and strengthen manufacturing. The campaign includes a Manufacturing Council comprised of more than 200 manufacturing companies, and a Manufacturing Caucus in the State Legislature that has a membership of 69 Senators and Assembly members.
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