CPAs in Pennsylvania and New Jersey are pessimistic about economic trends both nationally and statewide, according to a new survey.
The survey, commissioned by the New Jersey Society of CPAs and the Pennsylvania Institute of CPAs, found widespread pessimism among the poll respondents when asked about economic conditions next year.
Many of the CPAs surveyed predict conditions over the next year will be “about the same as they were one year ago.” The survey examined economic trends both statewide and nationwide. More CPAs favor immediate deficit reduction (in New Jersey, 45 percent; in Pennsylvania, 54 percent) than fiscal stimulus (N.J., 21 percent; Pa., 14 percent).
CPAs in both states predict increases in business revenues over the next 12 months (N.J., 44 percent; Pa., 48 percent). Three out of four CPAs believe the business climate in their state is either fair or poor (N.J., 79 percent; Pa., 75 percent).
When it comes to the dim view of the current U.S. economy, many CPAs in both New Jersey and Pennsylvania pointed to a list of items they felt are hindering economic growth. Both groups cited the federal deficit, global economy, and entitlement spending in their top three.
When asked about organizational and client growth, CPAs from both states agreed that over the past year their organizations or their clients’ organizations have not increased their workforce and don’t expect to do so in 2013. CPAs in both states do, however, predict marginal increases in firm/company revenues in the coming year.
Pennsylvania CPAs were clear about what they believe is impeding growth in the state. When asked which state issues were most likely to hinder economic growth, Pennsylvania respondents ranked pension funding for public employees high, with 53 percent ranking it either first or second. Forty-six percent thought the influence of unions in pricing and contractor selection was the state regulation with the most negative impact on Pennsylvania business. When asked if the tax structure in their state was better or worse than other states, 49 percent of Pennsylvania CPAs said it was worse.
New Jersey CPAs reported that issues such as the global economy (93 percent), federal deficit (83 percent), impending fiscal cliff (80 percent), entitlements (77 percent), and federal regulations (75 percent) negatively affected national economic growth over the last year. New Jersey respondents recommended several economic remedies. For national issues, 45 percent favored deficit reduction, while on statewide issues, 44 percent favored reducing property taxes, 40 percent reducing red tape, and 29 percent consolidating school districts. On a positive note, the survey found that 40 percent of New Jersey respondents expect their clients’ revenues to increase over the next year, while 58 percent feel that the business climate in New Jersey has moderately or greatly improved since Governor Chris Christie took office.
More than 1,200 CPAs in Pennsylvania and New Jersey responded to the survey to identify the economic, business and political trends affecting the regional and national economies. The data for the survey was gathered during September and October 2012 by the Franklin & Marshall College Center for Opinion Research. The questions were designed by Center for Opinion Research staff, the NJSCPA and the PICPA.
To see the full report, click here.