Governor Phil Murphy told South Jersey business leaders Wednesday that his administration expects the state to be poised to enter a recession triggered by the 2008 subprime mortgage crisis. I don’t think it’s much more serious than that.
“I’m in the shallow — realistic but meaningful — but shallow, fairly short-lived recession camp, partly because there’s a huge amount of liquidity on the sidelines,” Murphy said. I think so,” he said. Annual luncheon of the Jersey Chamber of Commerce.
Murphy has $1.4 billion in unused American Rescue Plan dollars and $6.8 million in state surplus funds, as well as the federal government’s income the state is expected to receive under the Bipartisan Infrastructure Act, the CHIPS Act, and the Inflation Reduction Act. Combined with the aid, suggested that it would help the garden. Fast recovery.
New Jersey’s economy recovered more slowly than most other states in the aftermath of the Great Recession, with some lingering effects in the decade after the crisis.
While the state is experiencing rapid growth as it emerges from the pandemic, Treasury Department officials warn they expect tax collection to be lenient this year. The first signs of that moderation are already appearing.
New Jersey’s collections from major sources of revenue (including state sales, income and corporate business taxes) increased only 0.5% in November compared to the same month last year.
Treasury and legislative officials said November sales tax collections were only higher than the previous year because November 2021 had one more Wednesday than November 2020. In other words, the employer made an additional withholding tax.
Overall, the administration expects revenue to decline by 3.2% in fiscal year 2023 compared to the previous fiscal year. The Treasury will release December revenue this week.
Rising inflation, sluggish consumer spending and soaring interest rates have made economists think for months that a recession was likely this year. A Bloomberg survey of economists last month gave him a 70% chance of a recession in 2023.
More recently, however, some economists have shown positive signs that the economy is headed for a so-called soft landing, a slowdown but no recession.
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