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The basics:

• 64% of NJCPA members expect NJ economy to worsen in late 2026
• Respondents support Sherrill initiatives including NJ Transit funding, permitting reforms
• Political dysfunction, regulations, labor costs rank among top business concerns
• Business leaders favor reducing regulations, lowering taxes

As Gov. Mikie Sherrill prepares to sign her first spending plan into law later this month, a new survey from the New Jersey Society of Certified Public Accountants found support for several administration initiatives even as respondents voiced growing concerns about the state’s economy and business climate.

The survey polled nearly 300 members of NJCPA from late May through early June ahead of the June 30 budget deadline. It found support for the Sherrill administration’s new permitting dashboard, investments in NJ Transit, and grants and low-interest loan programs.

At the same time, respondents cited political dysfunction at the state and national levels, a business-unfriendly state and federal policies, employee and benefit costs, a shortage of skilled workers and regulatory requirements as the top challenges facing New Jersey businesses.

State of the economy

The survey also revealed increasing economic pessimism. Nearly two-thirds (64%) of respondents said they expect New Jersey’s economy to worsen during the second half of 2026, while 28% said they expect conditions to remain about the same. That marks a more pessimistic outlook than last year, when 56% expected conditions to worsen and 36% expected them to remain stable.

Respondents were somewhat less pessimistic about the national economy, though concerns remained elevated. Forty-five percent said they expect economic conditions across the United States to worsen during the second half of the year, while 23% expect them to remain unchanged.

When asked about the biggest challenges facing businesses, 55% of respondents ranked political strife at the state and national levels among their top three concerns. State and federal policies viewed as unfriendly to businesses followed at 39%, while 33% cited employee and benefit costs. It marks the first time labor costs have ranked among the top three concerns since the survey began in 2016.

Respondents also pointed to the availability of skilled workers and regulatory requirements as significant challenges facing employers in New Jersey.

Biggest challenge? 55% of respondents ranked political strife at the state and national levels among their top three concerns.

What would help?

Business leaders said government could best support employers over the next 12 months by reducing regulations and lowering taxes. Fifty-seven percent of respondents identified reducing burdensome regulations as a top priority, while 40% supported lowering the gas tax and 37% favored reducing the state’s corporate tax rate.

Additional priorities included investing in infrastructure and lowering interest rates.

The survey also found support for several state initiatives, including property tax relief programs, the administration’s proposed retirement savings program for employers that do not offer retirement plans, and proposals regulating artificial intelligence data centers.

“Data from our member surveys is an important indicator of the business landscape in New Jersey,” said Aiysha (AJ) Johnson, CEO and executive director of the NJCPA. “By representing thousands of business owners, leaders and individuals across the state, our members have an important read on everyday business decisions.”

The survey comes as the Sherrill administration finalizes a proposed $60.7 billion fiscal year 2027 budget that includes:

• $7.3 billion for the state’s pension system
• $12.4 billion for K-12 education
• $4.2 billion in property tax relief through programs such as ANCHOR, Senior Freeze and Stay NJ
• Approximately $2.1 billion for the State Transportation Capital Program

Johnson added that the organization looks forward to working with state policymakers.

“We welcome the opportunity to be a resource for Governor Sherrill’s administration and the New Jersey Legislature,” she said.