The life sciences aren’t often thought of as money-makers but the HealthCare Institute of New Jersey (HINJ) has found that they continue to play a leading role in driving New Jersey's economy.
HINJ today released key findings of its 2011 economic impact survey, conducted by Deloitte.
The life sciences include pharmaceuticals, biomedical technologies, life systems technologies, nutraceuticals, cosmeceuticals, food processing, environmental, biomedical devices, and organizations and “institutions that devote the majority of their efforts in the various stages of research, development, technology transfer and commercialization,” according to fractal.org.
"Although we had 20 percent fewer companies participating in this year's survey, those that did supply data demonstrate that the life sciences industry continues to be a major economic driver in New Jersey," Dean J. Paranicas, HINJ's president and CEO, said in a press release. "However, New Jersey continues to face stiff competition from around the world and within the U.S. for our industry's investment. If anything, this data reinforces the need for our leaders in Trenton and Washington to continue to pursue policies that create a more competitive and attractive business climate here, and we look forward to continuing to work with them to achieve this objective."
Paranicas noted that Governor Chris Christie and the State Legislature are working to make New Jersey “more competitive and attractive for life sciences investment,” including the creation of an aggressive and competitive business recruitment and retention program, adopting the “single sales factor” as the basis for calculating New Jersey's corporate business income tax, and improving the Business Employment Incentive Program (BEIP) for greater private sector collaboration with New Jersey's universities and colleges, according to the press release.
Even so, not everything came up roses in 2011. Unfortunately, the total economic impact to the state was lower last year than in 2010 -- $24.2 billion in calendar year 2010, as compared to $29.3 billion in calendar year 2009, the press release states.
Paranicas explained this by noting “this difference reflects fewer companies responding to the survey and may also be accounted for by the continuing effects of the global recession and industry consolidation.” Reduced capital spending didn’t help.
The reported number of full-time employees in the state also declined from 55,366 to 51,619 for the same period, a 6.8 percent decrease. “Reported capital spending decreased to $0.7 billion in 2010, down from $1.5 billion in 2009, and the economic impact of reported vendor spending was $5.5 billion, down from $8.4 billion in 2009. Gifts to New Jersey non-profit organizations totaled $161 million, down from $214 million in 2009. Total taxes paid in New Jersey declined to $731 million, from $773 million,” according to the press release.
But on the bright side, Paranicas reported that the data submitted by the 16 HINJ member companies that participated in both the 2010 and 2011 surveys “shows that the economic impact of those companies was generally constant, at $23.9 billion in 2010 and $24.5 billion in calendar year 2009. Among this cohort, global research and development spending increased by $1.4 billion, to $8.4 billion, and charitable donations in New Jersey also increased 8.1 percent, to $159 million from $147 million.”
Paranicas is bullish on New Jersey and the life sciences, noting that “research and development spending in New Jersey was up by 11.4 percent, to $6.1 billion, and medical device trials conducted by reporting companies soared 49.1 percent.”
Deborah DiSesa Hirsch is an award-winning health and technology writer who has worked for newspapers, magazines and IBM in her 20-year career. To read more of her articles, please visit her columnist page.Edited by
Rich Steeves
