News Column

Sandy Adds Uncertainty to NJ Economy

Dec. 26, 2012

Michael L. Diamond

They could see daylight.

Nearly five years after the housing market collapsed, the economy in 2012 strengthened. The residential real estate market stabilized. The private-sector added jobs, even though it lagged the nation. Community banks set their sights on expansion. Consumers were heartened.

Then came Sandy, delivering a new set of obstacles that few, if any, New Jersey business owners have had to navigate. Among them: whether they could even reopen?

It sets the stage for an economy that in 2013 is anybody's guess. The Asbury Park Press asked business owners and economists to assess the state's -- and their -- economic prospects in 2013.

Here is what they said:

Tim McLoone, who opened Rum Runner in 1987 and owns seven other restaurants:

"We're not open at the Rum Runner in Sea Bright, but everything else is open after two weeks to six weeks of not being open. But we have no plan for the Rum Runner. There's vendors and construction people sending invoices but aren't getting money back. For the locals the economy is kind of in suspension. I think eventually there will be a lot of money coming to the area but it's not there yet. Having said all that, in general, boy were we positioned to do well going forward. Everything was fantastic this fall until the storm....People love the Jersey Shore. They're coming back. The customers are coming. The hard part is, how do we get ready by May or June?"

Philip Cardelfe, partner with Cardelfe Masonry in Fair Haven:

"I have high expectations for 2012, and I think, unfortunately, a good reason for that is we do masonry construction and there's obviously a tremendous amount of damage to the area from Hurricane Sandy. From what I understand, homeowners are trying to settle with insurance companies. Towns are considering imposing new regulations for rebuilding. Right now from a masonry point of view, it's up in the air. Before the work will come to us, homeowners will need to consult architects and engineers. Once that is settled, eventually it will come to us."

Anika Khan, economist, Wells Fargo:

"The uncertainty around the fiscal cliff has a lot of businesses on hold ... For New Jersey in particular, we'll continue to see this kind of stop and go. New Jersey's overall economic activity wasn't in a place of strong or solid growth going into Sandy. When you put Sandy on top of overall economic growth, you're going to continue to get this pullback. It's still sitting on top of weak fundamentals.:

William V. Rapp, economist, New Jersey Institute of Technology:

"I think it looks pretty good for next year. Look at the major industries -- pharma, telecom, health care providers, all those activities seem to be back up and operating. There's no reason the New Jersey economy shouldn't bounce back in terms of major economic activities."

Abran Maldonado, 31, of Long Branch, who founded NuSkool, an online company that offers lesson plans tied to popular culture. His company graduated from TechLaunch, a program for technology start-ups at Montclair State University, and opened in New York in October:

This space is really booming right now. It didn't have the same job loss as other industries. Some people think it's a bubble that's going to pop. I really don't think that. This is one space where, as these technology companies get funding from investors or angels or (venture capitalists), their first priority is hiring, growing their team. There's so much hiring in this space."

Michael Munoz, senior vice president sales and marketing for Cranbury-based AmeriHealth New Jersey, a health insurer that is bracing for health reform's enrollment beginning in October 2013. It opened a kiosk at the Menlo Park Mall in Edison in November to try to reach more consumers:

"At the end of the day (health care costs) are going to be a burden on individuals and employers that are providing care for employees. It becomes inherently more expensive implementing it and complying with the structure because of enhanced benefits and the elimination of certain restrictions. In the long term, what we're starting to see, and the good part about what's happening, is we're having a different dialogue with providers in how we work together more effectively."

Khan, Wells Fargo:

"There's clearly a disconnect between what consumers and businesses are thinking right now, but businesses are concerned about the fiscal cliff. Consumers are more focused on expectations. When they're asked, what do you think about current conditions, it's unchanged from recent months. When they're asked, what about future economic conditions, they are more hopeful about what the economy could look like."

Patrick Murray, pollster, Monmouth University, West Long Branch:

"Property taxes and jobs are still the top two issues among voters in the state, even with Sandy in the mix. Jobs and the economy could become even more prominent a campaign issue in 2013, but it's not clear at this point whether (Gov. Chris Christie) will suffer from that. Voters really do hold Washington responsible for the economic issues much more than they hold Trenton responsible."

Abby Kohut, a Springfield, Union County-based career consultant, who is in the middle of a cross-country tour trying to educate job seekers:

"I believe it's difficult to find a job, but I also believe many people are finding jobs, and if they're doing things the right way they can land a job next year, and they could have landed one this year. It's all about networking and it's about using Linked In and it's about finding people who can help guide you, things like that. Knowing how to answer tricky h.r. questions. In general, do I think the economy is getting better? It's definitely getting better than it was a year ago."

Richard Goddin, owner of Traci Lins Antique Market and Flea Market on Mantoloking Road in Brick:

"We are an antiques and flea market and we sell virtually everything. The joke is, yeah but what about the kitchen sink? We actually have a couple of those too. We're about 20 percent off what it normally would be. A lot of people know we're here, even though the sign up the street says, 'Road Closed. Local Traffic Only.' I'm very optimistic. I've seen the progress they've made from the Mantoloking Bridge, which, from the other side, was obviously devastated. The ocean came through and people lost their homes. I'm not talking about bungalows; I'm talking multimillion dollar homes. When I saw that, I thought it would take five years before they even saw daylight. But they've made a tremendous amount of progress. Once the bridge is open again, it will bring a lot more traffic again by our store."

Source: (c)2012 Asbury Park Press (Neptune, N.J.) Distributed by MCT Information Services

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