New Jersey’s Connected Economy: Measuring the Ripple Effect of Economic Policy

Critical Considerations for Policymakers

 

According to Newtown’s third law of motion, for every action in nature there is an equal and opposite reaction. However, a new study undertaken by NJPRO, the New Jersey Policy Research Organization, demonstrates that that’s not the way the modern business ecosystem works, particularly in New Jersey.

 

Our analysis – New Jersey’s Connected Economy – shows that actions that impact New Jersey’s business environment or a specific industry, can produce far-reaching effects, positively or negatively, throughout the state due to the interconnected nature of our economy. And understanding that reality is a must for policymakers in Trenton, along with business and community leaders in New Jersey.

 

The NJPRO study examined the New Jersey business ecosystem with a focus on six key clusters: chemical manufacturing, food processing and manufacturing, health systems and services, information communications and technology, life sciences and tourism. Due to their long histories in New Jersey and significant size, these industry clusters all have an outsized impact on New Jersey’s economy, as our report demonstrates.

 

The gain or loss of a job in one of these clusters doesn’t mean an equal impact in the broader economy. For example, depending on the cluster, each job gained or lost results in between 1.6 to 4.6 jobs and $200,000 to $2.6 million in economic activity, as well as $5,000 to $30,000 in state tax revenues. These far-reaching effects in one industry can be immense.

 

This ripple effect, or impact on local and regional vendors in the supply chain, is especially significant when we examine the two largest clusters in the study: chemical manufacturing and life sciences. With nearly 44,000 jobs, chemical manufacturing’s average annual wage of $126,000 is nearly twice that of the private sector average. Our study found that a gain or loss of 500 jobs in that sector would mean 2,304 jobs gained or lost in the connected economy and a total impact of about $1.3 million.

 

The life sciences cluster in New Jersey, long known as “the medicine chest of the world,” is similarly significant, with 117,000 employees and a total payroll of around $16.5 billion annually. A gain or loss of 500 life science jobs would mean 1,651 jobs gained or lost after adding in direct, indirect and induced employment. Each job in the life sciences gained or lost is actually worth 3.3 jobs within the state economy, as well as $852,000 in economic output and $281,000 in wages.

 

In addition to the indirect economic impact produced by the supply chain as money flows through the procurement process, the impact on local retail activity, or “induced” economy is also affected by the health of the interconnected economy.  Induced employment includes local people on Main Street, such as restaurants, retail, and service providers in the community or region where a large facility or cluster is located.  As the facility or cluster grows, so does employee spending, and vice versa if the facility or cluster shrinks.

 

This relationship is a two-way street.  In today’s economy, companies seek areas with vibrant cultural and entertainment amenities for their employees and their families.  This is one of the core principles of the symbiotic nature of our connected economy.

 

The interconnected nature of New Jersey’s economy produces a benefit that experts call “agglomeration.”  An example of agglomeration is when a cluster of companies emerges and grows, attracting other companies that want to capitalize on the success of the cluster resulting in a network of area suppliers.  The attraction, development and retention of a strong workforce is also an example of agglomeration. These talented employees are critical to a specific industry, and they support additional industries within the state.

 

Another benefit of a thriving industry cluster is that concentration will in turn foster innovation. The more companies flourish in a state, the more innovation will emerge. In order to maintain this growth, however, the state must continue to create a favorable business climate to enable the mixing of inter-disciplinary human capital (i.e. researchers, entrepreneurs) and to facilitate the inflow of financial capital (i.e. research grants, venture capital funds).

 

The analyses in this report have led us to five primary conclusions.

 

  1. Policymakers should evaluate and consider the downstream impacts of changes in approaches to an industry cluster. It’s easy to think that a targeted tax or regulatory change will only impact that industry. But as demonstrated in this report, gains or losses will be felt downstream by their suppliers.
  2. Objectively evaluating the consequences of policy decisions is essential. All policy decisions inevitably require tradeoffs – and policies that impact business competitiveness are no different.
  3. Innovation is enhanced by diversity. The way to encourage innovation is to create a climate that is welcoming to a diversity of individuals, businesses, and industries. In turn the ultimate beneficiaries of innovation success are diverse individuals, businesses and industries.
  4. Changes to the cost structure of the supplier network or local businesses can result in reduced spending locally. In our global economy, companies have many choices on where they can source their business or grow their operations. Companies take into consideration a number of factors when considering where to locate and cost increases can encourage companies to look afar.
  5. State investments in talent and infrastructure make a difference. For long-standing industry clusters, state investments in talent development and infrastructure can help to reduce costs of doing business for crucial industries, making them more likely to grow and expand in New Jersey.

 

About The New Jersey Policy Research Organization Foundation (NJPRO)

A non-profit, non-partisan organization that produces independent research to provide the business perspective in the policy dialogue led by A.J. Sabath is Executive Director of NJPRO. NJPRO reports can be found at www.njprofoundation.org.

0 Comments On “New Jersey’s Connected Economy: Measuring the Ripple Effect of Economic Policy”

  1. Your comment is awaiting moderation.

    You’ve made your position very well..

    average age of viagra users 88 keys stay up viagra
    viagra generic
    cycling performance viagra – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  2. Your comment is awaiting moderation.

    You reported that really well!

    viagra by mail canada viagra niagra bottled water
    buy viagra
    edinburgh uk pages viagra find search – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  3. Your comment is awaiting moderation.

    Kudos! I like it.

    viagra into singapore viagra’s speed
    generic viagra online
    viagra canada online pharmacy – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  4. Your comment is awaiting moderation.

    You revealed it exceptionally well!

    c-pill discount viagra viagra canadian home office
    viagra for sale uk
    viagra to keep hard for hours – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  5. Your comment is awaiting moderation.

    Really quite a lot of fantastic facts.

    viagra cialis sample paypal washington post viagra aphganistan
    viagra online
    viagra on cnn advertisement – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  6. Your comment is awaiting moderation.

    You have made your point.

    viagra how fast viagra delivery
    viagra online
    vioxx viagra altace – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  7. Your comment is awaiting moderation.

    Great info, Many thanks!

    cheapest viagra generic substitute side effects if viagra
    viagra for sale uk
    viagra no perscription usa – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  8. Your comment is awaiting moderation.

    You actually stated that really well!

    cheap discount india viagra caverta generic for viagra
    cheap viagra
    difference levitra viagra – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  9. Your comment is awaiting moderation.

    Nicely put, Appreciate it!

    viagra prescription which is better chalis or viagra
    buy viagra
    description of viagra – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  10. Your comment is awaiting moderation.

    Point certainly utilized.!

    viagra for dogs niacin and viagra
    viagra 100mg
    viagra trial sample – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  11. Your comment is awaiting moderation.

    Truly loads of helpful info.

    buying viagra from canada female viagra cream
    generic viagra 100mg
    does viagra hurt women – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  12. Your comment is awaiting moderation.

    You revealed this superbly!

    availability viagra europe backache from viagra
    viagra for women
    viagra cataracts – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  13. Your comment is awaiting moderation.

    Amazing plenty of helpful tips!

    bob dole viagra ad viagra kamagra
    generic viagra 100mg
    viagra store generic levitra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  14. Your comment is awaiting moderation.

    Awesome stuff, Thanks!

    viagra prices virginia viagra online for wemen
    cheap viagra
    ni teens forum sildenafil viagra – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  15. Your comment is awaiting moderation.

    Beneficial tips. Appreciate it.

    list generic viagra buy cheap deal viagra viagra viagra
    viagra 100mg
    genic viagra from india – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  16. Your comment is awaiting moderation.

    Whoa tons of fantastic data!

    viagra best taken when find viagra free sites computer search
    buy viagra online
    viagra risk stroke – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  17. Your comment is awaiting moderation.

    You said it nicely.!

    us drugstore pharmacy viagra tking viagra
    generic viagra online
    old man and viagra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  18. Your comment is awaiting moderation.

    With thanks. Loads of info!

    viagra causing bleeding behind ones eyes use of viagra for premature ejaculation
    viagra pills
    wet women viagra – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  19. Your comment is awaiting moderation.

    Nicely put. Thanks.

    lavitra vs viagra fastest delivery viagra
    cheap viagra
    before viagra – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  20. Your comment is awaiting moderation.

    Really loads of helpful facts!

    cialis cialis cialis genuinerx net viagra girls opinion of boyfrieds on viagra
    buy generic viagra
    viagra in germany – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  21. Your comment is awaiting moderation.

    With thanks. A good amount of tips!

    bangkok viagra prazosin impotence viagra
    buy generic viagra
    viagra best price sildenafil – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  22. Your comment is awaiting moderation.

    With thanks, Ample material.

    is viagra for me how long fo viagra to work
    viagra without a doctors prescription
    viagra blood low pressure – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  23. Your comment is awaiting moderation.

    Terrific write ups, Many thanks.

    hugh hefner’s viagra supply erection after orgasm viagra
    viagra without a doctor prescription
    instant natural viagra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  24. Your comment is awaiting moderation.

    You actually suggested that perfectly!

    online viagra fast viagra 4-7 days
    viagra 100mg
    buy generic online viagra – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  25. Your comment is awaiting moderation.

    Cheers, Helpful stuff.

    viagra lawsuits won in 2010 when was viagra discovered
    buy viagra
    legal viagra online – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  26. Your comment is awaiting moderation.

    Thanks, Useful information.

    keywords viagra viagra sudden weight gain
    generic viagra 100mg
    viagra v – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  27. Your comment is awaiting moderation.

    Cheers. Loads of forum posts.

    amiodarone and viagra viagra generic meltabs
    buy generic viagra
    viagra ad on rush limbaugh – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  28. Your comment is awaiting moderation.

    You stated that exceptionally well.

    does passport cover viagra what to expect from viagra
    buy generic viagra
    cheep viagra – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  29. Your comment is awaiting moderation.

    Seriously quite a lot of very good material.

    wemans viagra the viagra myth
    viagra 100mg
    result of viagra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  30. Your comment is awaiting moderation.

    Awesome information. Thank you!

    generic viagra price compare will viagra make my penis harder
    viagra 100mg
    are viagra is good solution – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  31. Your comment is awaiting moderation.

    Whoa many of amazing info!

    cvs viagra xost health viagra insurance coverage
    buy viagra online
    viagra both levitra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  32. Your comment is awaiting moderation.

    Amazing quite a lot of helpful tips!

    viagra for wemon viagra funny video
    viagra pills
    viagra los angeles mastercard – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  33. Your comment is awaiting moderation.

    Good write ups. Cheers.

    what does viagra cost at walgreens risks of long term viagra use
    viagra generic
    can viagra help after prostate surgery – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  34. Your comment is awaiting moderation.

    Position nicely utilized..

    idose viagra viagra stories real peoples experiences pharmacy
    viagra online
    viagra herbal substitute – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  35. Your comment is awaiting moderation.

    You actually reported this really well.

    viagra plus muse injecting viagra
    generic viagra 100mg
    viagra psychology – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  36. Your comment is awaiting moderation.

    You actually reported it terrifically!

    viagra shit viagra pills
    generic viagra 100mg
    viagras other uses – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  37. Your comment is awaiting moderation.

    Thanks, I like it!

    stress and viagra buy viagra pill online
    buy generic viagra
    viagra doctor consultation and shipping free – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  38. Your comment is awaiting moderation.

    Fine tips. Appreciate it!

    viagra and generic splitting viagra 100 mg
    generic viagra 100mg
    delaware caverta generic viagra veega – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  39. Your comment is awaiting moderation.

    Awesome facts. Kudos!

    viagra diazide viagra achat
    cheap viagra
    wanted to buy viagra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  40. Your comment is awaiting moderation.

    You actually explained it exceptionally well!

    generic viagra canadian pharmacies viagra falls pete hart
    generic viagra
    buy now online viagra – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  41. Your comment is awaiting moderation.

    You reported it fantastically!

    viagra for sale online breakthrough treatment sildenafil viagra
    viagra without a doctors prescription
    generic viagra vs pfizer – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  42. Your comment is awaiting moderation.

    This is nicely put. !

    viagra canada prescription viagra usage directions
    viagra 100mg
    viagra lower blood pressure – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  43. Your comment is awaiting moderation.

    Superb posts. Appreciate it.

    viagra and niacin viagra uk without prescription
    viagra for women
    viagra fast delivery – https://genericviagrantx.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  44. Your comment is awaiting moderation.

    Kudos! Quite a lot of write ups!

    personel accounts viagra men that have taken viagra
    viagra online
    discount viagra pills – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  45. Your comment is awaiting moderation.

    Seriously tons of beneficial knowledge.

    viagra’s speed drugs giant viagra pill cialis men
    generic viagra online
    viagra substitute business opportunities – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  46. Your comment is awaiting moderation.

    Thank you, I appreciate it!

    viagra retail discoun free sex viagra
    viagra 100mg
    viagra giving a man an erection – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  47. Your comment is awaiting moderation.

    Valuable info. Cheers.

    edinburgh search viagra find pages cyalis levitra market sales viagra
    viagra 100mg
    will not stay hard w viagra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  48. Your comment is awaiting moderation.

    Kudos! I enjoy this!

    take cialis soft and viagra together taking epinephrine and viagra together
    buy generic viagra
    viagra 4 – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  49. Your comment is awaiting moderation.

    Info effectively taken..

    edinburgh uk viagra news comment moo viagra effect on women
    viagra generic
    la viagra – https://genericviagrarcp.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  50. Your comment is awaiting moderation.

    Awesome data. Appreciate it!

    alternative viagra zenegra sites charles linskaill find viagra alerts
    generic viagra 100mg
    i doser viagra – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  51. Your comment is awaiting moderation.

    You expressed that wonderfully.

    when cialis and viagra don’t work viagra celais
    viagra for sale uk
    viagra rx affiliate – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

  52. Your comment is awaiting moderation.

    Terrific postings. Kudos!

    herbal substitutes for viagra natural substitute for viagra
    generic viagra online
    generic viagra vs pfizer – https://genericviagramsl.com

    KeithGoorb
    RichardCer
    Ernestobiolo

Leave a Reply

Your email address will not be published. Required fields are marked *