The Bureau of Economic Analysis estimates that New Jersey's total state product in 2006 was $434 billion. Its per capita personal income in 2004 was $41,636, 2nd in the U.S. and 126% of the national average of $33,041. Its median household income is the highest in the nation with $55,146. It is ranked 2nd in the nation by the number of places with per capita incomes above national average with 76.4%. Nine of New Jersey's counties are in the wealthiest 100 of the country. New Jersey faces a deficit that could be as large as 3 billion for the fiscal year that starts July 1, 2008.
New Jersey has seven tax brackets for determining income tax rates. The rates range from 1.4 to 8.97%. The standard sales tax rate is 7%, applicable to all retail sales unless specifically exempt by law. Exemptions include most food items for at-home preparation, medicines, clothing (except fur items), footwear, and disposable paper products for use in the home. Approximately 30 New Jersey municipalities are designated as Urban Enterprise Zones and shoppers are charged a 3�% tax rate, half of the rate charged outside the UEZs. Sections of Elizabeth and Jersey City are examples of communities that are subject to the lower sales tax rate. All real property located in the state is subject to property tax unless specifically exempted by statute. New Jersey does not assess an intangible personal property tax, but it does impose an inheritance tax.
Industry
New Jersey's economy is centered on the pharmaceutical industry, chemical development, telecommunications, food processing, electric equipment, printing and publishing, and tourism. New Jersey's agricultural outputs are nursery stock, horses, vegetables, fruits and nuts, seafood, and dairy products.
New Jersey has a strong scientific economy. New Jersey is home to major pharmaceutical firms such as Johnson and Johnson, Sanofi-Aventis, Novartis, Pfizer, Merck, Wyeth, Hoffman-LaRoche, Bristol-Myers Squibb, and Schering-Plough. New Jersey is home to major telecommunications firms such as Verizon Wireless, Avaya, Alcatel-Lucent and AT&T Communications. Furthermore, New Jersey draws upon its large and well-educated labor pool which also supports the myriad of industries that exist today.
New Jersey is the ultimate bedroom community since the state is right next to New York City and Philadelphia. Thus, there is a strong service economy in New Jersey serving residents who work in New York City or Philadelphia. Some of these industries include retail sales, education and real estate. Newark Liberty International Airport is ranked seventh among the nation's busiest airports and among the top 20 busiest airports in the world.
Shipping is a strong industry in New Jersey because of the state's strategic location. The Port Newark-Elizabeth Marine Terminal was the world's first container port and is one of the world's largest container ports. New Jersey also has a strong presence in chemical development, refining and food processing operations.
New Jersey hosts several business headquarters, including twenty-four Fortune 500 companies. Paramus is noted for having one of the highest retail sales per person ratios in the nation.
Several New Jersey counties such as Somerset (7), Morris (10), Hunterdon (13), Bergen (21), Monmouth (42) counties are ranked among the highest-income counties in the United States. Four others are also in the top 100.
Federal taxation disparity
New Jersey has the highest imbalance of any state in the United States between what it gives to the federal government and what it receives. In fiscal year 2005, New Jersey taxpayers gave the federal government $77 billion dollars but only received $55 billion dollars back. This difference is higher than any other state and means that for every $1.00 New Jersey taxpayers send to Washington, the state only receives $0.61 dollars back. This calculation is applied correctly after making the federal government deficit neutral as sometimes the federal government spends more than it takes in. As of 2005, New Jersey has never been above 48th in rank for per capita federal spending (with a rank of 50th for the majority of that time) since 1982 while being 2nd or 3rd in the per capita federal taxes paid to Washington.
As a result, New Jersey runs into deficits frequently and has one of the highest tax burdens in the nation. Factors for this include the large federal tax liability which is not adjusted for New Jersey's higher cost of living and Medicaid funding formulas. Incomes tend to be higher in New Jersey as shown by the study which puts people in higher tax brackets especially vulnerable to the alternative minimum tax, however such higher salaries are negated by the high taxes when you include the high property and state/local income taxes and the low rate of return by the federal government which may cause those high taxes.
Natural resources
New Jersey's greatest natural resource is its location, which has made the state a crossroads of commerce. Other commercial advantages include its extensive transportation system, which puts one quarter of all United States consumers within overnight delivery range. Lake and seaside resorts such as Atlantic City have contributed to New Jersey's rank of fifth among the states in revenues from tourism.
Despite more than three centuries of development almost half of New Jersey is still wooded. The chief tree of the northern forests is the oak. A large part of the southern section is in pine. Jersey oak has been used extensively in shipbuilding.
The mineral
resources in New Jersey are small.
The state, however, does rank high
in smelting and refining minerals
from other states. Some mining
activity does still take place in
the area in and around the
Franklin
Furnace, which was long a center
of zinc
production.