Legislative Manufacturing Caucus
Manufacturing

Proposed Budget Cuts May Impact NJ Manufacturers

The state has competing agendas when it comes to supporting New Jersey’s manufacturing sector. While it wants to create good paying jobs that will allow people to raise families here, it is demonizing the companies creating those jobs.

“That’s our harsh reality,” said New Jersey Business & Industry Association (NJBIA) President and CEO Michele Siekerka at a Legislative Manufacturing Caucus hearing held yesterday at a State of the State of Manufacturing event in Trenton.

Amid an audience of manufacturing leaders, experts and supporters, Siekerka and New Jersey Manufacturing Extension Program (NJMEP) Director & CEO Peter Connolly, discussed how taxes (including the proposed $1 billion Corporate Transit Tax), regulations and the overall cost of doing business are negatively impacting the industry while economic environments in other states, especially neighboring Pennsylvania, are more business friendly. Some of those states are frequently calling New Jersey-based manufacturers to lure them with incentives to relocate.

At the same time, Gov. Phil Murphy’s FY 2025 budget proposal calls for cuts in agencies, organizations and programs that have been a boon to the state’s manufacturing sector. This includes an NJMEP budget reduction from $2.5 million to $2 million, cutting the New Jersey Council of County College’s operating aid by $20 million, and cutting the New Jersey Economic Development Authority’s New Jersey Manufacturing Voucher Program by $10 million.

“It’s a tough budget year and there are a lot of programs [being targeted] that affect New Jersey manufacturers, such as the NJEDA’s Voucher Program, which was an unmitigated success in creating jobs,” said Connolly.

Cliff Lindholm III, president and CEO of Falstrom Company, a contract manufacturer serving the aerospace and defense industry, said that the voucher program was a “godsend” that allowed his 154-year-old company to purchase high-tech machinery that helped maintain the firm’s competitive edge with national competitors.

Meanwhile, Gail Friedberg Rottenstrich, co-founder and CEO of ZAGO Manufacturing, said that NJMEP helped her company double revenues and increase its workforce by 50 employees. “It helped transform us into a sophisticated and competitive business. NJMEP provides small and mid-sized businesses with the resources that they can’t get elsewhere,” she told members of the Legislative Manufacturing Caucus, adding, “I’m obviously asking you all today to restore NJMEP funding to the $2.5 million level.”

Manufacturers are also facing a workforce shortage, especially the need for highly skilled employees. This workforce is also aging, with Connolly saying that NJMEP members will have to replace their workforce in the next 10 years due to retirements.

This is why NJMEP has partnered with the NJEDA in a Makers & Creators tour. “It’s our way of inspiring the next generation of manufacturing professionals,” Connolly said. “We are showing kids in middle school and high school that there are careers in manufacturing. We are showing them the true face of modern manufacturing. We visit with 3D welding machines, CNC machines, and 3D printers.

“Also, through state funding, we have a Mobile Training RV that is outfitted with similar equipment. The goal is to visit schools, school board associations, and show people there are careers in manufacturing,” Connolly said.

Meanwhile, Aaron Fichtner, president of the New Jersey Council of County Colleges, discussed the NJ Pathways to Career Opportunities initiative.

“We hope this unique partnership between NJBIA and the community colleges will continue,” he said of the program, which includes 10 centers of workforce innovation, with two focusing on manufacturing. “We are focusing this year on processing and bio manufacturing in an innovative partnership led by Mercer County Community College, Middlesex College and Raritan Valley Community College,” Fichtner said. “We are also focusing on the broader manufacturing supply chain and logistics industry with eight of our colleges working together to develop new curriculum in a whole set of [related] areas.”

An NJBIA, NJMEP and Consortium project Fichtner mentioned was the NJ Manufacturing Skills initiative, saying, “We are dedicated to creating a one-stop approach to meeting the industry’s workforce needs. We are building a statewide repository of training and education programs. We are serving as an ambassador for manufacturing-related education and training so that employers have a single place to go to get assistance. We are also launching initiatives from career awareness to apprenticeship programs. We will be helping 250 individuals get manufacturing training to help them with their careers.”

Just before the Legislative Manufacturing Caucus hearing began, State Senator Mike Testa (R-1), co-chair, told New Jersey Business Magazine that the state needs to make sure it highlights the manufacturing industry in the state so that young people see it as a viable career option where one can not only survive, but thrive. “As the sign on the Lower Trenton Bridge says, ‘Trenton Makes, the World Takes.’ We really need to make that mean something again,” Testa said.

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