Private-sector employment was devastated in the last two months of 2008 as New Jersey lost more than 33,700 private-sector jobs in November and December alone, according to the monthly employment report released January 21 by the NJ Department of Labor and Workforce Development (LWD).

Such a huge drop has substantially drained the State's already low Unemployment Insurance (UI) fund, prompting the possibility of a huge payroll tax increase that could be as much as $700 million - an increase of 30 percent in the middle of a deep recession.

In response, Corzine announced the formation of a federal stimulus working group to spearhead New Jersey's efforts to maximize federal economic stimulus aid. The working group will include key cabinet members and Governor's staff with Washington experience. According to a statement from the Governor's office, the group will be charged with reviewing various federal stimulus proposals and will work with the State's congressional delegation to ensure that New Jersey is "at the front of the line" to get the maximum amount of assistance for job creation and economic recovery.

One of the group’s first jobs will be to secure federal funds to help bolster the UI fund. If the fund balance falls below a certain level on March 31, payroll taxes on businesses will increase automatically under federal law. Such a massive tax increase on employers in the middle of a recession would be disastrous for New Jersey’s employers, employees and the economy. Corzine and legislators added $260 million to the fund last year to avoid a tax hike, and Corzine has pledged another $250 million this year, but is counting on additional federal funds to avoid the automatic tax increase.

The UI fund is in dire straights because past administrations and the Legislature diverted $4.7 billion in UI taxes to other uses to balance the State budget. But the problem has been exacerbated by a sharp increase in unemployment, which is forcing the fund to pay out more in benefits even as its revenues decline.

Private-sector employment dropped by 14,600 jobs in December, and revised employment numbers from November showed a loss of 19,100 private-sector jobs, according to the report. That brings total private-sector job loss for 2008 to 59,800, the biggest one-year loss since 1991. The massive job losses in December pushed New Jersey’s unemployment rate up a whopping full percentage point, from 6.1 percent to 7.1 percent.

US House Proposes $825 Billion Economic Stimulus Bill

The Democratic majority in the US House of Representatives has proposed a $825 billion economic stimulus bill designed to kick start the economy with a combination of increased government spending and tax cuts. The bill is already unprecedented in its scale and reach, and could well increase as it makes its way through the legislative process.

The House proposal includes $318 billion in spending on infrastructure, energy, education and training, and other programs; $275 billion in tax cuts; $166 billion in State fiscal relief; and $66 billion in unemployment and health care benefits for long-term jobless workers.

The proposal includes a $1,000 tax cut for working couples and $500 for single workers. First-time homebuyers purchasing houses between January 1 and June 30 would get a $7,500 tax credit. The measure would also add $120 billion over the next two years to help local school districts cope with severe budget cuts as State and local government revenues shrink. States also would get $87 billion worth of help with their Medicaid budgets over the next two years.

The tax portion of the bill, H.R. 598 (Rangel), passed the House Ways and Means Committee on January 22, while the House Appropriations Committee began consideration of the spending portion. It could reach the House floor as early as next week.

Feb. 20 Seminar: How You Can Get Contracts in NJ's Multi-Billion Dollar School Construction Program

Governor Jon Corzine recently signed legislation providing $3.9 billion for new school construction. At this seminar, to be held from 8:00 a.m. to noon at the Pines Manor in Edison (Route 27), you will learn how the program will operate and how to capture school construction work. Two dozen school construction projects will be going to bid between March and September 2009! Also, you can meet Kris Kolluri, the new Chief Executive Officer of the New Jersey Schools Development Authority.

Register online now, or contact Stacy Wichner at 609-393-7707, ext. 213, for more information. To become a sponsor, call Sherry Esteves at ext. 219.

Meet the Governor’s Top Advisors, Friday, February 27

Meet Governor Jon Corzine's new Chief of Staff, Ed McBride, Jr.; new Chief Counsel, William Castner, Jr.; and his new Policy Counsel, Michellene Davis at our first Meet the Decision Makers briefing of the year. Find out what the Governor has planned for the coming year! This great networking event will begin with registration and breakfast at 7:45 a.m. and ends at 10:00 a.m.

Register online or contact Stacy Wichner at 609-393-7707, ext. 213, for more information. To become a highly visible sponsor, contact Sherry Esteves at ext. 219.

Navigating Paid Family Leave in NJ, March 6 & 18

Starting in July 2009, employees will be able to take six weeks of paid leave each year for the birth or adoption of a child or to deal with a family member’s "serious health condition." Hear directly from top legal experts who will provide you with details on how the law will impact your workplace and how it will work with existing State and federal unpaid leave laws. Learn how to protect yourself and your business!

Register online for either the March 6 seminar at the Forsgate Country Club in Monroe Township or the March 18 seminar at the Sheraton in Eatontown. For more information, contact Katie Wittkamp at 609-393-7707, ext. 239, or contact Sherry Esteves at ext. 219 to become an event sponsor.