LOGISTICS
NJ Positioned for a Key Role in Post-Pandemic Economy
A sophisticated transportation system of roads , rails , seaports and airports are key advantages .
By Diane C . Walsh Contributing Editor
Despite the harsh blows New Jersey was
dealt by the COVID‐19 virus , leading business academics suggest the state is well-positioned to reap economic benefits in the post-pandemic environment .
“ New Jersey has an opportunity to recast itself ,” explains Professor John Laski of New Jersey City University ( NJCU ). Laski has been analyzing data compiled by the Society of Manufacturing Engineers ( SME ) which predicts a resurgence of manufacturing in the United States that he believes could distinctly favor the Garden State .
The professor , whose expertise is in business administration , management and leadership , says the state ’ s sophisticated transportation system of roads , rails , seaports and airports will be key advantages in a manufacturing resurgence .
“ The supply chain is changing . We ’ re not relying on China , Malaysia , Singapore and Vietnam as heavily as we were , domestically . New Jersey is positioned uniquely to provide the rest of the nation with the manufacturing , the high-paying jobs and the primary sourcing that many other states do not have the capacity to do ,” Laski says .
His colleague , David Weiss , a business professor and the founder of the Institute for Dispute Resolution at NJCU , concurs wholeheartedly . Weiss , whose work focuses on developing business relationships across borders , says higher education will play a pivotal role because it will be responsible for shaping the new talent pool .
Weiss used the term “ new collar jobs ,” coined by IBM ’ s CEO , Arvind Krishna , to describe the innovative , high-tech positions such as those involving data analysis , cybersecurity and Cloud computing , which will be in demand in the post-pandemic environment . Advanced manufacturing would be another category of a new-collar job , which fits into the paradigm the two professors envision for New Jersey ’ s future .
There are more than 11,000 manufacturers in New Jersey , according to the New Jersey Manufacturing Extension Program , an organization committed to improving the industry ’ s operations . Sophisticated , high-tech manufacturing was once the “ bread and butter of New Jersey ,” when such iconic names as Bell Labs and Bendix maintained sprawling plants within the state , Laski notes .
Over the past 30 years , however , the manufacturing base retracted as many companies outsourced or relocated overseas as they sought to
NJCU Professor John Laski
lower costs . But product shortages during the pandemic and supply chain disruptions have led to calls to reshore and return these operations to the United States .
Manufacturing could be the pathway to resilience in the state , the NJCU professors insist . Unlike the service industry or retail , manufacturing provides high-paying jobs for workers , who in turn support the economy through consumer spending and taxes .
Laski says the optimism within the industry is apparent in a recent SME survey . Two-thirds of the respondents said they were “ very to somewhat optimistic ” that by the end of 2020 , manufacturing will recover to the productivity levels it achieved before the pandemic , according to the professor .
Another key indicator that New Jersey is on the precipice of a resurgence is the industrial space vacancy rates . The growth of online shopping produced a great demand for warehouse space , Weiss says . The latest reports show the industrial property vacancy rate has dropped statewide to a historic low of 3 percent . There is currently 7.6 million square feet of new construction underway , as well . The average rent is $ 9.43 per square foot — a 5 percent increase over last year and in the premiere market along the New Jersey Turnpike the increase is more than 13 percent .
Weiss says “ there is the good , the bad and the ugly of COVID‐19 ” in New Jersey . The demand for warehouse space , the revenue it generates
NJCU Professor David Weiss
and the jobs it will bring are obvious examples of the good that can result from the pandemic . Regular viewers of Gov . Phil Murphy ’ s press conferences are also well aware of the tragic effects of the virus . More than . 215,000 people have contracted coronavirus , leading to more than 14,000 deaths across the state . The shutdown imposed to combat the spread of the virus also caused grave economic upheaval . Businesses in most sectors suffered , resulting in 1.6 million workers being forced onto the unemployment rolls since last March .
The two NJCU professors argue the state can reverse some of the economic losses by positioning itself for action in the post-pandemic environment . Weiss stresses the state must act now . “ This artificial opportunity could dissolve quickly ,” Weiss cautions .
Already , New Jersey ’ s ports are feeling the competition from Canada . Weiss says Saint John , New Brunswick is offering shipping credits and drafting international treaties to become an alternative gateway for containerized import bound for the Northeast region . He warns that if New Jersey does not focus on strengthening its competitive advantages and logistics network “ the rest of this house of cards will fall .”
Laski and Weiss say New Jersey ’ s success is dependent on government leadership and support from higher education and the private sector .
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