As Weather Improves & COVID Fades, What's the 2021 Outlook for NJ Tourism? - GSI - Garden State Initiative

As Weather Improves & COVID Fades, What’s the 2021 Outlook for NJ Tourism? – GSI

Flight From NJ, Economic Opportunity for All

As Weather Improves & COVID Fades, What’s the 2021 Outlook for NJ Tourism? – GSI

May 10, 2021

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By Regina M. Egea, President, Garden State Initiative

While Mother’s Day was cold and chilly across much of New Jersey, the calendar and improving weather ahead will turn our attention to the long-awaited Memorial Day Weekend, the kickoff of summer and tourism season.   Our 2020 summer season was devastated by the then-emerging COVID pandemic compared to the year before.  Specifically, consider the numbers:

Source: VisitNJ.org

What will the 2021 season look like and what policies can New Jersey put in place to take advantage of improving conditions while growing our economy and supporting small business and workers alike?

 As vaccinations become more widespread and summer approaches with improving weather, customers will be eager to eat a meal with friends, enjoy entertainment venues, and take a much needed “staycation” at one of New Jersey’s beach towns or resorts. An additional positive note, this summer is predicted to be warmer than normal with rainfall below normal in the north and above normal in the south. 

To be sure, the state has taken certain actions to support the Tourism industry.  A digital advertising campaign will ignite interest from an extended region, though the data on Ad impressions and real conversions to sales are illusive.  And the grant and loan programs through the Economic Development Agency (EDA) can bridge cash needs as capacity limits persist, but the bureaucracy and paperwork required will discourage many and delay re-investing those funds back into the businesses. Neither of these government actions provide the immediate “shot in the arm” needed to get a running start on the short season from Memorial Day to Labor Day weekends. Grants and loans do not rebuild economic “muscle.”

What NJ needs are more consumers through the doors of small businesses and able-bodied workers fully employed to serve those customers.

Are there more aggressive actions that can be quickly implemented to provide an economic burst for NJ’s struggling economy?  Yes, in fact, there are several that other states are already employing: 

1) RELIEVE LABOR SHORTAGE WITH BACK-TO-WORK INCENTIVES: Opt-out of federally enhanced unemployment benefits and offer a bonus to workers returning to work. Montana is ending its participation in the federal unemployment program that gives people extra weekly unemployment benefit payments.  Under the new Montana incentive program, workers currently receiving $300 weekly unemployment payments can qualify for a one-time $1,200 bonus after they have completed four weeks in their new jobs. The governor approved $15 million in funding for the incentives from federal [W1] coronavirus relief money allocated to the state.


Regina M. Egea

Regina M. Egea

2)  LET SALES AND TOURISM TAXES STAY IN SMALL BUSINESSES’ CASH REGISTERS: Colorado’s Gov. Jared Polis (D)  announced with broad bipartisan support, a plan that would allow the Rocky Mountain State’s bars and restaurants to keep sales tax remittances. Last December, Gov. Polis and that state’s legislature moved to permit a deduction of up to $70,000 in sales taxes for restaurants, bars and food trucks for the months of December through February.  New Mexico’s Governor Michelle Lujan Grisham (D) signed into law a bipartisan bill to fund a four-month tax holiday on gross receipts taxes for restaurants, bars, food trucks, small breweries and more. The bill also implemented a $600 tax credit or rebate for those earning about $15 an hour. 

3)  EXEMPT FIRST $10,200 OF INDIVIDUAL TAXABLE INCOME MIRRORING THE EXEMPTION FOR UNEMPLOYMENT BENEFITS  Providing more take home pay to seasonal or part -time workers is a direct way to support these individuals as well as the small businesses who frequently are their employers for the summer season.  We have heard from small business owners repeated the request from college age or recent graduates to hire them “off the books” or for cash so they are not disqualified from receiving unemployment benefits.  This type of creative and targeted tax policy can relieve this barrier and incent work instead of unemployment benefits.

There are myriad of ideas the business community has offered to safely accelerate our economic recovery.  With the already-approved injection of over $6 billion of federal aid, and more likely to follow from some version of $2.3 trillion infrastructure and $1.8 trillion for working families and students, New Jersey has the surplus resources to be bolder in allowing our free market to perform as constructed.  Let’s get back to work and enjoy a much more prosperous summer of 2021 and stronger economy for 2022!