Study finds residents leaving NJ — and taking their money with them
The New Jersey Business and Industry Association says the state has lost almost $21 billion dollars in adjusted gross income over the past 11 years to so-called "outmigration," which is defined as people leaving for greener pastures in other states.
The NJBIA crunched figures from the IRS that showed Jersey's economy losing more than $2 billion in adjusted gross income in 2015 alone.
Association President and CEO Michele Siekerka says "the continuation of outmigration has a negative impact on New Jersey's economy, so that continues to cause concern."
Indeed, the NJBIA analysis found that New Jersey has lost $31.5 billion in adjusted gross income since 1992.
But Siekerka says that they are hopeful that the type of comprehensive tax reform that was signed last week will do much to help the tide of outmigration.
"The tax reform bill of last week is a first step in what we hope is a continuing movement toward further tax reform."
The measure signed by Gov. Chris Christie last Friday will raise New Jersey's gas tax a very unpopular 23-cents-per-gallon, starting Nov. 1. But also included in the measure is a decrease in the state sales tax from 7 percent to 6.875 percent by January and to 6.625 percent by July. It would phase out the estate tax, changing the threshold from $675,000 to $2 million in 2017, and eliminating it altogether in 2018.
And the deal includes raising the earned income tax credit, which helps low-income residents, from 30 percent to 35 percent for the current tax year, and increasing the tax exclusion on retirement income over four years to $100,000 for joint filers. Veterans would get personal exemptions for state income taxes under the measure.
Rutgers economist James Hughes says another issue prompting people to leave New Jersey is that "we still have enormously high costs within the state, and it is going to take a long time for that to reach equity with other states."
According to Hughes, Brooklyn has become enormously popular for Millennials.
"They want to live near other Millennials and it really has that 'cool factor,' and that cool factor surmounts many obstacles." Those obstacles include one of the highest costs of living in the country.
Hughes also says another potential positive for the Garden State is that some of the destinations, which seemed attractive many years ago, may be losing their attraction.
"North Carolina has enacted several policies, such as the transgender [public restroom law] and the like, that are making it a less hospitable place. I do not wish bad things for our competitor states, but the magic is not going to last forever."
Joe Cutter is the afternoon news anchor on New Jersey 101.5. Contact him at Joe.Cutter@townsquaremedia.com.