Release Date: 09/ 01/ 2005
CONTACT: John Holub, (609) 989-8777 or Jim Jennings, (240) 645-4099
Insurance and Big-Business Competition Remain Top Problems
TRENTON, N.J. -- New Jersey’s small-business owners continue to have a dim outlook on the state’s business environment, with only a net 11 percent reporting the state’s environment as “supportive” of small business, according to the New Jersey Small-Business ConditionsSM. The report’s data, which was released today by the National Federation of Independent Business/New Jersey, provides an overview of small-business conditions within New Jersey and compares them with neighboring states.
Pennsylvania and New York small-business owners weren't much happier, with only 10 percent and 12 percent respectively, reporting a state environment that was supportive of small business.
“Let’s be realistic here. We have a legislature that increases the minimum wage, allows unions to organize businesses without an election and wants to reform property taxes on the backs of business. Does that sound supportive to you,” asked John Holub, state director of NFIB/New Jersey.
A net 43 percent of the state’s small employers believed business conditions in their individual market area are “good,” but they don't see things “improving.” Only 7 percent believed conditions would improve compared to 9 percent in New York and 1 percent in Pennsylvania. Outside the immediate region, the contrasts were more stark, with a net 30 percent in Arizona, a net 25 percent in Florida, and a net 27 percent in Virginia assessing conditions as good.
In New Jersey, a net 62 percent characterized the outlook for business over the next three months as better, an increase from last quarter, citing increased sales prospects and greater productivity. Small-business hiring has been steady with only 22 percent reporting “one or more” current job openings. One-third reported profits were “good” in the third quarter, an increase from 21 percent in the second quarter, and 42 percent reported good sales, also an increase over the second quarter.
When asked to rank their most important business problem, New Jersey small-business owners ranked insurance as the most serious of all conditions, followed by big-business competition and inflation and rising prices. Half reported the prices of their purchases having risen in the last three months and just 18 percent were able to raise their selling prices.
The Small Business ConditionsSM reports are developed from surveys of small-business owners in selected states. The surveys are designed to determine the condition of the small-business economy in each particular state. The surveys are conducted every three months and results are released on the first day of the month following completion. The text of the questions and the complete response set to the survey can be found at www.NFIB.com/research.
| New Jersey Small-Business ConditionsSM | ||||||
| This chart shows the results from New Jersey and its comparative standing among selected nearby states. | ||||||
| N.J. | N.Y. | Pa. | ||||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 8/2005 | 11 | 12 | 10 | ||
| Prior qtr. | 11 | 0 | 22 | |||
| Business conditions in market area | ||||||
| Net % "good" | 8/2005 | 43 | 29 | 30 | ||
| Prior qtr. | 33 | 22 | 30 | |||
| Net % "improving" | 8/2005 | 7 | 9 | 1 | ||
| Prior qtr. | 13 | 0 | 0 | |||
| Outlook for business | ||||||
| Net % "good" in next three months | 8/2005 | 62 | 53 | 52 | ||
| Prior qtr. | 57 | 47 | 53 | |||
| Reason for optimism | ||||||
| % Sales prospects | 8/2005 | 42 | 47 | 41 | ||
| Prior qtr. | 39 | 48 | 37 | |||
| % Lower costs | 8/2005 | 3 | 3 | 4 | ||
| Prior qtr. | 2 | 4 | 1 | |||
| % Price increases | 8/2005 | 5 | 7 | 5 | ||
| Prior qtr. | 3 | 3 | 4 | |||
| % Greater productivity | 8/2005 | 15 | 13 | 12 | ||
| Prior qtr. | 11 | 13 | 18 | |||
| % Government policy | 8/2005 | 3 | 5 | 3 | ||
| Prior qtr. | 6 | 4 | 4 | |||
| % Seasonal/Weather | 8/2005 | 10 | 7 | 9 | ||
| Prior qtr. | - | - | - | |||
| Reason for pessimism | ||||||
| % Sales prospects | 8/2005 | IC* | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Cost increases | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Pressure on selling prices | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Lower productivity | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Government policy | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| N.J. | N.Y. | Pa. | ||||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 8/2005 | 42 | 42 | 43 | ||
| Prior qtr. | 34 | 31 | 35 | |||
| Profits | ||||||
| Net % profits "good" | 8/2005 | 31 | 26 | 22 | ||
| Prior qtr. | 21 | 10 | 21 | |||
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 8/2005 | 22 | 23 | 21 | ||
| Prior qtr. | 22 | 21 | 19 | |||
| Per employee payroll cost | ||||||
| Net % "risen" | 8/2005 | 17 | 19 | 21 | ||
| Prior qtr. | 16 | 16 | 15 | |||
| Employee cost pressures (greater) | ||||||
| % Wages | 8/2005 | 49 | 48 | 44 | ||
| Prior qtr. | 49 | 45 | 51 | |||
| % Benefits | 8/2005 | 33 | 29 | 36 | ||
| Prior qtr. | 32 | 31 | 31 | |||
| N.J. | N.Y. | Pa. | ||||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 8/2005 | 46 | 46 | 38 | ||
| Prior qtr. | 38 | 41 | 43 | |||
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 8/2005 | 41 | 46 | 38 | ||
| Prior qtr. | 37 | 40 | 42 | |||
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 8/2005 | 40 | 43 | 38 | ||
| Prior qtr. | 34 | 35 | 40 | |||
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 8/2005 | 53 | 55 | 50 | ||
| Prior qtr. | 51 | 45 | 52 | |||
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 8/2005 | 35 | 32 | 37 | ||
| Prior qtr. | 40 | 35 | 43 | |||
| % All credit needs not satisfied | 8/2005 | 6 | 10 | 4 | ||
| Prior qtr. | 5 | 6 | 4 | |||
| % No credit needs | 8/2005 | 52 | 54 | 52 | ||
| Prior qtr. | 46 | 50 | 45 | |||
| N.J. | N.Y. | Pa. | ||||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 8/2005 | 50 | 55 | 59 | ||
| Prior qtr. | 50 | 54 | 59 | |||
| Selling prices (last three months) | ||||||
| Net % increased | 8/2005 | 18 | 18 | 18 | ||
| Prior qtr. | 18 | 14 | 18 | |||
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 8/2005 | 9 | 11 | 10 | ||
| Prior qtr. | 13 | 11 | 11 | |||
| Single most important business problem | ||||||
| % Weak sales | 8/2005 | 9 | 11 | 9 | ||
| Prior qtr. | 12 | 11 | 13 | |||
| % Taxes | 8/2005 | 10 | 15 | 15 | ||
| Prior qtr. | 9 | 11 | 11 | |||
| % Employee quality/costs | 8/2005 | 8 | 7 | 7 | ||
| Prior qtr. | 8 | 8 | 10 | |||
| % Insurance | 8/2005 | 21 | 15 | 18 | ||
| Prior qtr. | 20 | 16 | 19 | |||
| % Big-business competition | 8/2005 | 15 | 13 | 14 | ||
| Prior qtr. | 13 | 14 | 13 | |||
| % Inflation/Rising prices | 8/2005 | 13 | 10 | 13 | ||
| Prior qtr. | 10 | 10 | 13 | |||
| % Credit availability/Interest rates | 8/2005 | 2 | 3 | 3 | ||
| Prior qtr. | 3 | 1 | 3 | |||
| % Regulations/Red tape | 8/2005 | 9 | 8 | 7 | ||
| Prior qtr. | 8 | 7 | 7 | |||
* Insufficient cases
| New Jersey Quarterly Spotlight | |
| Is the PRIMARY reason for any cash flow problems in your business generally associated with:? | |
| The need to make large investments and wait for sales | 6% |
| Unexpected variations in sales and costs | 11% |
| Seasonality | 16% |
| Weak sales | 13% |
| Difficulty collecting money owed you | 15% |
| Don't expect cash flow problems | 25% |
| Other | 2% |
| Don't know/Refused | 12% |
| Total | 100% |
| Which is the ONE most important action you usually take to resolve a cash flow problem? Do you:? | |
| Draw on personal resources | 22% |
| Borrow | 11% |
| Adjust scheduled payments | 9% |
| Adjust schedules purchases | 12% |
| Try harder to collect money owed you | 21% |
| Other | 7% |
| Don't know/Refused | 19% |
| Total | 100% |
The Poll
NFIB’s New Jersey Small-Business ConditionsSM is a telephone survey of a random sample of New Jersey small employers regarding business conditions within the state. “Small employer” is defined here as employing between one and 250 people (not including the owner(s)) in a for-profit business. Each edition of the survey has a minimum of 350 respondents. The sampling error is ± 5 percentage points. Data are collected quarterly in the months of February, May, August and November, beginning in February 2005. The MRCGroup of Las Vegas conducts the survey for the NFIB Research Foundation.
The Sponsor
The NFIB Research Foundation is a 501 (c)(3) organization that provides policy-makers, media, educators, small-business owners and other interested parties empirically based information on small business and small-business owners. The Foundation is affiliated with the National Federation of Independent Business, the nation’s largest small- and independent-business advocacy organization, and is located in Washington, D.C.
