NJ JOBS: Setting a Goal, What Won’t Happen, & How Manufacturing Can Help

In the previous diary on NJ JOBS we examined the wrong track approach which emphasizes reducing government, budgets, and debt. By putting people back to work, however, the state can regain tax revenues needed to reduce indebtedness and replenish our unemployment, transportation, and pension/health funds. More important, it brings a measure of relief, security and optimism, sorely lacking now, to people who want to hold on to their home, put food on their table, pay bills, and reduce their reliance on government support. The argument should not be, as Christie says, over jobs for the private sector vs. the public sector because both are essential to our economy and our well-being.

Our state government, famous for imposing objectives on organizations it funds, could set its own objective for lowering unemployment. A decrease of just 1%, from 9.5% to 8.5%, in the unemployment rate would add about 45,000 new jobs for those who are now struggling. At an average salary of $25,000 it would add over $1 billion to our economy, part of which would go to taxes, strengthening the state’s revenues. A substantial reduction in unemployment to 5% or 6% is a longer term objective which entails retooling education, innovation and automation for new jobs replacing those which are no longer needed and in which we are no longer competitive. A state goal of 1% or 2% is not an impossible dream.

Some ideas which would strengthen jobs, the economy and tax revenues and cost the state nothing, but which our current governor would reject outright, include legalizing same-sex marriage and marijuana. Increasing the tax rate for millionaires, anathema to Christie, remains sensible. Funding family planning clinics is a common sense health policy and also brings in about 9 federal dollars to our economy and more jobs for each dollar the state spends. Christie’s selective decisions to refuse federal funds is ideological pettiness and injurious to the state.

One important area in which to foment new job opportunities is manufacturing. Growth of the N. J. labor force is inextricably entwined with the ability of industry to grow new business models. Just North Jersey alone, which boasted 156,000 factory workers two decades ago now has below 60,000. As Rep. Rush Holt (D-12th) succinctly stated at a Rutgers manufacturing forum, “In Washington, recently we’ve been having a lot of distractions, but revitalizing manufacturing should have been the main interest all along.” Such can be said about our state as well. In a still-operating Totowa factory recently visited by Rep. Bill Pascrell (D-8th), little appeared high-tech. Some of the machines go back to the 1940s. One set of machine benches was computerized, with small monitors from the 1980s.

Our President today visited nearby Paterson, once a thriving industrial center, but beset by horrific floods and a decimated manufacturing base. Many factories have closed and others like the one in Totowa have outdated equipment and can not compete in terms of labor and raw material costs with factories oversees. New Jersey proudly announced last month that it had reached a U.S. solar-energy milestone – more than 10,000 solar installations statewide, second behind only California. The milestone, however, is in installing not manufacturing the panels. Paterson Mayor Jeffrey Jones is set to confer in October with Chinese manufacturers about using the city’s abandoned shop floors for building solar panels. Combining now a foreign manufacturer who wants to set up a facility in the U.S. with ongoing and strengthened American solar panel research and job retraining are steps in the direction of job creation.

In helping industry cope with its problems sometimes our state government has reserved its largesse for the larger, splashy companies at the expense of smaller firms which also need assistance in these changing times. In February, the New Jersey Economic Development Authority approved $41.2 million in tax credits to Campbell Soup for investing $52 million in an upgrade of its headquarters which the company said would generate about 100 new jobs in Camden. Now Campbell has reduced its staff instead, and the EDA will re-evaluate the credits. About 80% of New Jersey’s 11,000 manufacturers employ 50 or fewer workers. However, much of the research and development is conducted by these smaller firms as they refine, improve, and modernize their systems. Within the manufacturing sector, as with other sectors, the key is correctly targeting tax cuts, incentives or loans to firms which have the best prospects for spurring job opportunities. Smaller firms can often be more agile and aggressive.

There will be more on putting people back to work in the next installment of NJ JOBS.  

Comments (6)

  1. Couch Potato Politics

    If the state a federal government would offer low interest loan backing and significant subsidies for American Manufactured solar, geothermal and wind-turbine alternative energy installations on single family homes and apartment buildings, imagine the jobs growth.

    Sudden intense demand would create hundreds of thousands if not MILLIONS of tax-paying jobs in research, development, manufacturing, installation and maintenance.

    The familes buying into these systems would save money with reduced energy costs and reduce their carbon footprint.

    Add an annual tax credit for anyone owning and operating a plug in car that ticks off more than 6,000 miles a year and it just adds to the incentive.

    This country needs to get back to being a manufacturing force and there have to be penalties for companies moving manufacturing jobs off shore.

    There have to be incentives for foreign countries to even the trade defecit through higher tariffs or import caps.

    The country will not survive as a wholey service based economy.

    The time for change is now. This isn’t a hard problem to figure out. get Big Oil out of the way and off the shoulders of the politico’s and we can make a change.

    Reply
  2. proud2Bliberal

    Job creation won’t put a dent in the unemployment figures as long as hiring is a game of musical chairs among the employed.

    Here is an example from my own experience.  I used to live in NJ, where I formerly worked in R&D for a large telecom company.  A recruiter presented my resume for a contract job at that company.  The job was in the same field I worked in there previously.  I am also a co-inventor on a patent owned by that company in that field.  You would think I might have an advantage in the hiring process.

    No – my resume did not get through the HR gatekeepers because they said I didn’t have “recent experience.”

    “Recent experience” is the term used to legally discriminate against the unemployed.  Companies with automated resume scanners choose the candidates with the most recent matching experience.

    The hiring process designed to discriminate against the unemployed.  

    Many employers have a fixation on recent experience.  They will ask numerous questions about what you have been doing while unemployed, while completely ignoring the actual experience on your resume during the time you have been employed.

    More about the hiring system as a cause of long term unemployment in another comment.

    Reply
  3. proud2Bliberal

    20% of all engineering graduates are women.  Except in chemical engineering, only half of these women have careers in the field of their education.  The US is not utilizing 10% of the engineers it trains simply because women are locked out.  Next time you hear a politician say that there is a shortage of engineers, kindly make the individual aware of that issue.

    Reply
  4. proud2Bliberal

    Start Medicare at age 50.  Allow employers to contribute a reasonable premium for their older employees.  Then Medicare would be infused with premiums from healthy 50 year olds.  Employers wouldn’t fear exorbitant premiums for older workers.  This would stop age discrimination and cure a great deal of long term unemployment.

    Reply

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