>>> THIS WEEK ON "NJ BUSINESS BEAT" -- TRENDING IN THE RIGHT DIRECTION.

>> WE LEARNED LAST MONTH THAT THE INFLATION RATE CAME DOWN, DOWN MORE THAN EXPERTS EXPECTED.

>> WHAT THE LATEST CONSUMER PRICE INDEX TELLS US ABOUT INFLATION TRENDS IN THE NEW YEAR.

>>> PLUS, FALLOUT FROM THE WORLD OF CRYPTO AS FTX'S FORMER CEO IS ARRESTED.

>>> AND WITH THE YEAR COMING TO A CLOSE, WE PUT THE 2023 ECONOMIC OUTLOOK IN FOCUS, BREAKING DOWN THE FINANCIAL GOALS FOR NEW JERSEY BUSINESS OWNERS AND FINDING OUT WHY MANY ARE WORRIED ABOUT A LOOMING RECESSION.

THAT'S AHEAD ON "NJ BUSINESS BEAT."

♪♪ >> THIS IS "NJ BUSINESS BEAT" WITH RHONDA SCHAFFLER.

>> HELLO, I'M RHONDA SCHAFFLER.

THANKS FOR JOINING ME ON "NJ BUSINESS BEAT."

THROUGHOUT 2022 IT WAS HARD TO FIND ANY GOOD NEWS ON INFLATION.

PRICES HAVE BEEN SOARING SO HIGH AND FOR SO LONG.

AS THE YEAR WINDS DOWN, THERE IS HOPE THAT NEXT YEAR MAY BE BETTER.

THE GOVERNMENT'S MONTHLY REPORT ON INFLATION MEASURED BY THE CONSUMER PRICE INDEX SHOWED ANNUAL PRICE INCREASES COOLED IN NOVEMBER.

NOW LET'S NOT KID OURSELVES -- INFLATION IS STILL HIGH, RUNNING ABOVE 7%.

LEVELS WE HAVEN'T SEEN IN DECADES.

INFLATION ISN'T RISING AS FAST AS BEFORE.

LOOK AT GAS PRICES.

WE'RE PAYING LESS AT THE PUMP THAN LAST YEAR.

SO THE HOPE IS THAT INFLATION WILL KEEP TRENDING LOWER.

GIVEN ALL THE FOCUS ON RISING COSTS THIS YEAR, PRESIDENT BIDEN CALLED THE LATEST DEVELOPMENTS WELCOME NEWS.

>> NOW INFLATION'S COMING DOWN, AS WELL.

PRICES OF THINGS LIKE TELEVISIONS AND TOYS ARE GOING DOWN.

IT'S GOOD NEWS FOR THE HOLIDAY SEASON.

USED CAR PRICES FELL FOR THE FIFTH MONTH IN A ROW.

NEW CAR PRICES DIDN'T GO UP THIS MONTH.

THAT SAVINGS IS CRITICAL TO SO MANY FAMILIES.

IT GIVES THEM A LITTLE BREATHING ROOM FOR THE HOLIDAY SEASON.

>> FEDERAL RESERVE CHAIRMAN JEROME POWELL TALKED ABOUT THE HEALTHY LABOR MARKET THIS WEEK WHEN HE ANNOUNCED THAT THE FED WOULD RAISE INTEREST RATES AGAIN FOR A SEVENTH TIME THIS YEAR.

THESE RATE INCREASES CAN BE ANNOYING FOR YOU AND ME BECAUSE IT MAKES ANY LOANS WE HAVE MORE EXPENSIVE.

RATES GO UP ON CREDIT CARD DEBT, CAR LOANS, AND SOME HOUSING AND SCHOOL LOANS.

WHEN RATES INCREASE, INFLATION GOES DOWN, AT LEAST THAT'S THE ECONOMIC THEORY.

ECHOING THOSE COMMENTS MADE BY PRESIDENT BIDEN, CHAIRMAN POWELL SAID INFLATION STILL ISN'T FALLING QUICKLY ENOUGH, AND IT WILL TAKE A WHILE FOR THINGS TO GET BACK TO NORMAL.

SO HE VOWED THE FED WILL CONTINUE RAISING RATES INTO NEXT YEAR.

>> THE LABOR MARKET IS CLEARLY VERY STRONG.

IT IS MORE JUST THAT, YOU KNOW, BY NOW WE HAD EXPECTED -- WE'VE CONTINUALLY EXPECTED TO MAKE FASTER PROGRESS ON INFLATION THAN WE HAVE ULTIMATELY.

AND THAT'S WHY THE -- THAT'S WHY THE PEAK RATE FOR THIS YEAR GOES UP BETWEEN THIS MEETING AND THE SEPTEMBER MEETING.

YOU SEE THAT -- THE FACT THAT WE'VE MADE LESS PROGRESS THAN EXPECTED ON INFLATION.

THAT'S WHY THAT GOES UP.

THAT'S WHY UNEMPLOYMENT GOES UP BECAUSE WE'RE HAVING TO TIGHTEN POLICY MORE.

>> EVERY COUPLE OF YEARS IT SEEMS THERE IS A SPECTACULAR FINANCIAL INDUSTRY COLLAPSE THAT CAPTIVATES THE MARKETS AND TERRIFIES INVESTORS.

THE LATEST, OF COURSE, IS THE IMPLOSION OF CRYPTOCURRENCY EXCHANGE FTX WHICH FILED FOR BANKRUPTCY.

THE FOUNDER, SAM BANKMAN-FRIED, HAS NOW BEEN INDICTED ON SEVERAL CHARGES -- FRAUD, MONEY LAUNDERING, AND IMPROPER USE OF CUSTOMER FUNDS.

ON CAPITOL HILL THIS WEEK, THE COMPANY'S NEW CEO WAS ASKED TO TESTIFY ON WHAT WENT DOWN, AND HE CALLED IT A CASE OF GOOD OLD-FASHIONED EMBEZZLEMENT.

WHILE THE COURTS AND OTHERS WILL BE LEFT TO SORT OUT THE MESS, MEMBERS OF CONGRESS LIKE NEW JERSEY SENATOR BOB MENENDEZ RAISED QUESTIONS THAT HAVE BEEN RAISED BEFORE -- HOW CAN SOMETHING LIKE THIS HAPPEN, AND WHY WEREN'T INVESTORS PROTECTED?

>> BROKERS ARE NOT PERMITTED TO USE CUSTOMER FUND TO FINANCE THEIR BUSINESS.

THEY ARE REQUIRED TO FULLY DISCLOSE CONFLICTS OF INTEREST.

AND WHEN DEALING WITH RETAIL INVESTORS, THEY ARE REQUIRED TO GO FURTHER AND MITIGATE CERTAIN CONFLICTS.

FTX DIDN'T SEEM TO HAVE DONE ANY OF THIS, AND IF THEY HAD IT SEEMS LIKE A LOT OF HARM WOULD HAVE BEEN PREVENTED.

>> HOUSING IN NEW JERSEY IS EXPENSIVE, AND THAT INCLUDES RENTAL PROPERTIES, TOO.

NEW JERSEY IS THE SEVENTH MOST EXPENSIVE STATE FOR RENTERS, ACCORDING TO DATA FROM THE NATIONAL LOW-INCOME HOUSING COALITION.

AND THAT'S WHY A BATTLE OVER RENT CONTROL WAS CLOSELY WATCHED IN ELIZABETH.

COMMUNITY LEADER HAD BEEN FIGHTING TO KEEP RENT CONTROL PROTECTIONS IN PLACE.

BUT THIS PAST WEEK, THE CITY COUNCIL VOTED TO REMOVE THOSE PROTECTIONS AND WILL ALLOW LANDLORD TO TACK ON 3% INCREASES IN RENT STARTING NEXT YEAR.

LANDLORDS HAD ARGUED THEIR COSTS ARE GOING UP, BUT COMMUNITY ADVOCATES SAY THE COUNCIL'S ACTIONS WILL HAVE DIRE CONSEQUENCES.

>> THE FEAR HAS ALWAYS BEEN THAT THEY'RE NOT GOING TO -- THEY'RE GOING TO HAVE TO DECIDE BETWEEN PAYING RENT, PERHAPS, VERSUS PAYING FOR LIKE GROCERIES AND OTHER EXPENSES THAT ARE CRUCIAL TO THEIR NEEDS.

WE FEAR IT COULD LEAD TO FURTHER DISPLACEMENT.

THAT AS RENTS GO UP, PEOPLE WILL BE PRICED OUT AND WILL HAVE NOWHERE TO GO, SOMETHING WE'RE SEEING AMONGST COMMUNITY MEMBERS THAT WE'VE TALKED TO OR JUST WHEN THEY'RE LOOKING FOR HOUSING, NOT ABLE TO FIND PLACES WITH AFFORDABLE RENTS THEY CAN PAY FOR.

>> MANUFACTURING COMPANIES IN NEW JERSEY COULD BE GETTING A FINANCIAL BOOST.

THEY ARE ELIGIBLE FOR STATE GRANTS TO BUY NEW EQUIPMENT OR IMPROVE OPERATIONS.

A FEW DAYS AGO THE NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY BEGAN ACCEPTING PRE-EQUALIFICATION APPLICATIONS -- PREQUALIFICATION APPLICATIONS FOR THE NEW JERSEY MANUFACTURING VOUCHER PROGRAM.

$20 MILLION HAS BEEN SET ASIDE FOR THIS PROGRAM, AND THE GRANTS ARE GENEROUS.

COMPANIES COULD RECEIVE UP TO $250,000.

INTERESTED MANUFACTURERS MUST PRE-QUALIFY FIRST IN ORDER TO ACCESS THE FULL APPLICATION WHICH IS GOING TO BE MADE AVAILABLE AT A LATER DATE.

THE PREQUALIFICATION WINDOW WILL CLOSE NEXT WEEK ON DECEMBER 22nd.

>>> WITH INFLATION STILL A MAJOR ISSUE AND INTEREST RATES RISING, IT'S HARD NOT TO BE PESSIMISTIC ABOUT THE ECONOMIC OUTLOOK FOR 2023.

IT'S HARD TO TALK ABOUT OUR ECONOMIC FUTURE WITHOUT USING THE "R" WORD -- RECESSION.

WITH 2022 COMING TO A CLOSE, WE'RE PUTTING NEXT YEAR'S ECONOMIC OUTLOOK IN FOCUS THIS WEEK.

SEVERAL MAJOR U.S. BANKS AND FUNDS ARE PREDICTING A RECESSION IN 2023, INCLUDING BANK OF AMERICA, JPMORGAN CHASE, VANGUARD, WELLS FARGO, AND CITI GROUP.

AND MANY OF THESE BANKING INSTITUTIONS ARE PREDICTING MAJOR JOB LOSSES, WITH MOST BELIEVING UNEMPLOYMENT WILL RISE TO AROUND 5.5% WITH MORE THAN A MILLION JOBS LOST OVER THE NEXT 12 MONTHS.

HERE IN NEW JERSEY, MANY BUSINESS OWNERS THINK THE RECESSION HAS ALREADY STARTED.

ACCORDING TO AN NJ CHAMBER POLL OF BUSINESS OWNERS EARLIER THIS YEAR, NEARLY 70% THINK WE'RE IN A RECESSION RIGHT NOW, AND FOR THOSE WHO DON'T THINK WE'RE THERE YET, MORE THAN HALF THINK A RECESSION IS INEVITABLE IN THE NEXT TWO YEARS.

IN ITS RECENT 2023 ECONOMIC OUTLOOK, THE NJBIA FOUND PESSIMISM AMONG NEW JERSEY BUSINESS OWNERS.

52% BELIEVE NEW JERSEY'S ECONOMY WILL BE WORSE IN THE FIRST SIX MONTHS OF NEXT YEAR.

THAT'S THE LOWEST OUTLOOK FOR THE NJBIA SINCE 2009.

AND 24% OF OWNERS EXPECT A LOWER PROFIT IN 2023.

>>> MORE THAN HALF OF BUSINESS OWNERS HAVE NO PLANS TO EXPAND, AND IF THEY DO, A QUARTER OF THEM ARE GOING TO EXPAND OUTSIDE OF NEW JERSEY DUE TO AFFORDABILITY CONCERNS.

WHEN IT'S ALL SAID AND DONE, NEARLY TWO-THIRDS SAY THEY WILL NOT RETIRE IN NEW JERSEY.

>>> MY NEXT GUEST SAYS A RECESSION IS DEFINITELY HEADING OUR WAY, BUT THE FORECAST ISN'T AS SCARY AS YOU MIGHT THINK.

BANK OF AMERICA'S PROJECTING THE RECESSION WILL BE MILD, SO WHAT DOES THAT MEAN FOR YOU?

I TALKED WITH STEVEN JUNEAU AT BANK OF AMERICA GLOBAL RESEARCH.

THANKS FOR JOINING ME TODAY.

>> THANKS FOR HAVING ME ON, RHONDA.

>> WHAT IS BANK OF AMERICA PROJECTING IN TERMS OF A RECESSION IN 2023?

>> YEAH, SO AS YOU MAY HAVE HEARD WE'RE LOOKING FOR A MILD RECESSION NEXT YEAR.

WE THINK THAT WILL BE DRIVEN BY THE FED'S AGGRESSIVE POLICY STANCE.

SO THE FED AGAIN HIKED RATES BY 50 BASIS POINTS AT ITS LATEST MEETING.

THEY'RE DOING THAT TO TRY AND COOL OFF THE LABOR MARKET AND BRING DOWN INFLATION.

WE ULTIMATELY THINK THEY'LL CONTINUE TO HIKE RATES TO THE POINT WHERE IT WILL PUSH THE ECONOMY INTO A DOWNTURN, BUT THE RECESSION WILL BE MILD.

WE WILL SEE A RISE IN THE UNEMPLOYMENT RATE.

BUT ULTIMATELY IT WILL BE ON THE MILDER SIDE BECAUSE WE DON'T SEE MANY IMBALANCES OUTSIDE OF THE LABOR MARKET.

>> I THINK IN IS A GREAT POINT YOU ARE SAYING BECAUSE RECESSION CAN BE A VERY SCARY WORD.

THERE'S A BIG DIFFERENCE BETWEEN A MILD RECESSION AND SOMETHING THAT DIGS IN A LITTLE BIT MORE.

WHAT WOULD A MILD RECESSION LOOK LIKE FOR MOST PEOPLE?

>> YOU HAVE A DECLINE IN GDP, BUT IT'S NOT A HUGE DROP.

SO PEAK TO TROUGH LOOKING AT 1% DECLINE IN GDP.

THE UNEMPLOYMENT RATE DOES RISE IN OUR FORECAST TO 5.5% BY THE END OF NEXT YEAR, BUT IN THE GRAND SCHEME OF THINGS A 5.5% UNEMPLOYMENT RATE ISN'T THAT HIGH BY HISTORIC STANDARDS.

SO THAT'S WHY I WOULD SAY IT'S ON THE MILDER SIDE JUST LOOKING AT OUR FORECAST, OUR DETAILS.

YOU COULD LOOK AT -- BACK TO, SAY, 1990, '91 AS A COMPARISON PERIOD.

YOU'RE NOT THINKING A FINANCIAL CRISIS.

YOU'RE NOT THINKING SOME LIKE 2008, 2009.

THERE'S NOT MANY IMBALANCES OUTSIDE OF THE LABOR MARKET THAT WOULD MAYBE MAKE A RECESSION A LOT MORE SEVERE.

>> JUST TO GO A LITTLE DEEPER INTO THE JOB MARKET, YOU SEE UNEMPLOYMENT RISING IN TERMS OF THE RATE.

CAN WE STILL HAVE A RISING UNEMPLOYMENT RATE AND CONTINUED JOB GROWTH, COMPANIES ADDING JOBS WHILE OTHERS ARE SHEDDING?

>> WE SAW DURING THE PANDEMIC THAT THERE WERE A LOT OF WINNERS ON THE GOOD SIDE.

YOU SAW VERY STRONG LABOR DEMAND IN SECTORS THAT PROVIDED GOODS.

I'M TALKING ABOUT TRANSPORTATION AND WAREHOUSING, RETAIL TRADE, EVEN MANUFACTURING SAW VERY RAPID GAINS BECAUSE WE SAW CONSUMER SPENDING SHIFT OVER TO GOODS AND AWAY FROM SERVICES.

WE THINK IN THIS RECESSION YOU COULD SEE A LITTLE BIT OF A REVERSAL OF THAT.

TYPICALLY YOU SEE THE GOOD SECTOR WEAKEN DURING RECESSIONS, DURING TYPICAL RECESSIONS.

THE PANDEMIC WAS AN OUTLIER, A LITTLE BIT DIFFERENT.

YOU COULD SEE THE GOOD SECTOR MAYBE RELATIVELY WORSE OFF DURING THIS RECESSION THAN THE SERVICES SECTOR.

MAYBE LEISURE AND HOSPITALITY EMPLOYMENT WHICH HAS LAGGED BEHIND, IT HAS YET TO RECOVER TO ITS PRE-PANDEMIC LEVELS.

MAYBE THAT FARES BETTER IN OUR ECONOMIC OUTLOOK.

>> AND IN TERMS OF THIS MILD OUT OF IT ALL STRONGER THAN IT IS TODAY, OR WILL IT BE A MILD RECESSION AND THEN A GRADUAL REBUILD?

>> THAT'S A GREAT QUESTION AND A GREAT POINT.

SO WE THINK IT WILL COME OUT STRONGER.

SO IT'S IMPERATIVE FOR THE FED TO BASICALLY DRIVE DOWN INFLATION.

YOU HAVE TO REMEMBER THAT INFLATION AFFECTS EVERY CONSUMER, EVERY HOUSEHOLD, EVERYONE'S DEALING WITH HIGHER GROCERY BILLS, HIGHER ENERGY PRICES.

IN THE LONG RUN, IF THAT PERSISTS, IT'S VERY BAD FOR ECONOMIC OUTCOMES.

IF THE FED'S ABLE TO RESTORE STABILITY WHICH WE EXPECT IN OUR OWN FORECAST IN A SHORT PERIOD OF TIME, WE HAVE INFLATION GETTING DOWN TO ABOUT 2%, THE FED'S TARGET, BY YEAR END 2024.

IF THEY'RE ABLE TO RESTORE THAT IN A SHORT PERIOD OF TIME WITH JUST A MILD RECESSION, IT SETS THE U.S. ECONOMY FOR A MUCH FIRMER PATH OUTSIDE OF THAT RECESSION.

IN ADDITION TO THAT, I WOULD NOTE THAT IF YOU LOOK AT BALANCE SHEETS ON THE CONSUMER SIDE, ON THE BUSINESS SIDE, THEY'RE IN VERY HEALTHY SHAPE.

SO THAT'S ANOTHER REASON WHY WE EXPECT THE MILD RECESSION.

>> THANKS FOR SHARING YOUR INSIGHT.

>> THANKS.

>>> WE WANT TO DIVE DEEPER INTO THE 2023 BUSINESS OUTLOOK FOR THE STATE, SPECIFICALLY IN SOUTH JERSEY WHERE SOME NEW INDUSTRIES ARE TAKING HOLD AND PROVIDING OPPORTUNITIES FOR JOB SEEKERS.

I SAT DOWN WITH CHRISTINA RENNA, PRESIDENT AND CEO OF THE CHAMBER OF COMMERCE SOUTHERN NEW JERSEY.

CHRISTINA, IT'S GOOD TO SEE YOU BACK ON "NJ BUSINESS BEAT."

>> THANK YOU FOR HAVING ME, RHONDA.

>> LET'S GO BACK A YEAR, WHERE WERE YOU THIS TIME LAST YEAR WHEN YOU WERE THINKING ABOUT BUSINESSES IN SOUTH JERSEY AND THE ECONOMY COMPARED TO WHAT YOU'RE FEELING NOW.

ARE YOU OPTIMISTIC OR PESSIMISTIC AS THE NEW YEAR APPROACHES?

>> IN COMPARISON TO DECEMBER OF LAST YEAR, I THINK THAT SLOWLY BUT SURELY BUSINESSES ARE STARTING TO BOUNCE BACK.

IT REALLY IS THOSE MAINSTREAM BUSINESSES THAT WE CONTINUE TO SEE STRUGGLE THE MOST PREDOMINANTLY RIGHT NOW.

THAT BEING SAID, I DO THINK THIS HOLIDAY SEASON, THIS BUSY SHOPPING SEASON IS LOOKING UP.

HOWEVER, SMALL BUSINESSES CONTINUE TO REMAIN A CONCERN.

AT THE END OF THE DAY INFLATION IS VERY REAL AND IMPACTING SHOPPERS' DECISIONS.

WHETHER IT BE TO GO TO A RESTAURANT OR BUY EVEN A GIFT CARD, OR GO AND PURCHASE GIFTS AT A STORE.

SO THAT IS CERTAINLY A CONCERN.

BUT CERTAINLY IN A BETTER PLACE THAN LAST YEAR.

>> THERE'S NOT MUCH SMALL BUSINESSES CAN DO ABOUT INFLATION EITHER, RIGHT, BECAUSE IF THEY OFFER LOWER PRICES TO ENTICE PEOPLE TO COME IN, IT HURTS THEIR BOTTOM LINE.

>> ABSOLUTELY.

100%.

AND THIS IS ALL EXACERBATED BY SUPPLY CHAIN ISSUES THAT SMALL BUSINESSES MAY BE LOOKING TO GET ADDITIONAL PRODUCT INTO THEIR STORE OR HAVING A HARD TIME GETTING -- YOU KNOW, ALL OF THESE THINGS, LIKE A PERFECT STORM, WHETHER IT BE SOME OF THE LABOR SHORTAGES BUSINESSES ARE FACING, SUPPLY CHAIN ISSUES, CERTAINLY INFLATION.

ALL OF THIS COMBINED DOES UNFORTUNATELY MAKE IT A TOUGH ENVIRONMENT.

>> I WANT TO TALK TO YOU ABOUT THE POTENTIAL FOR BIG INDUSTRIES IN SOUTH JERSEY.

FOR THE FIRST TIME IN A WHILE THERE IS A LOT TO TALK ABOUT.

THERE IS WIND ENERGY THAT IS BEING DEVELOPED OR WILL BE DEVELOPED IN SOUTH JERSEY.

THERE'S EVEN AN E-SPORTS INNOVATION CENTER AS ANOTHER INDUSTRY PERHAPS MIGHT TAKE HOLD IN ATLANTIC CITY.

HOW EXCITED ARE YOU ABOUT THESE POSSIBILITIES FOR THE SOUTHERN HALF OF THE STATE?

>> WE'RE ALSO PERFECTLY POSITIONED FOR AN IMPLOSION AND ADVANTAGE OF THE CANNABIS INDUSTRY HERE IN SOUTH JERSEY GIVEN HOW AGRICULTURAL WE ARE HERE IN THE SOUTHERN HALF OF THE STATE.

AVIATION IS ANOTHER INDUSTRY REALLY TAKING OFF, FORGIVE THE PUN, HERE IN SOUTH JERSEY, WHETHER IT BE IN ATLANTIC COUNTY, UNIQUE, THINGS HAPPENING IN CAPE MAY COUNTY.

SO FOR THE FIRST TIME IN A LONG TIME, SOUTH JERSEY REALLY IS IN MY OPINION THE HOTTEST COMMODITY FOR LARGER BUSINESSES TO BE ATTRACTED TO OUR PART OF THE STATE.

AND ALSO DON'T FORGET, YOU KNOW, IT'S NOT CHEAP TO LIVE IN NEW JERSEY, BUT IT IS CHEAPER IN SOUTH JERSEY THAN IT IS IN OTHER PARTS OF THE STATE.

>> IN TERMS OF SOME OF THESE COMPANIES THAT HAVE REALLY DECIDED TO INVEST IN SOUTH JERSEY AND CLAIM A STAKE IN THAT PART OF THE STATE, WILL THEY FIND ADEQUATE SUPPORT?

I'M THINKING MAINLY OF THE WORK FORCE, THESE ARE NEWER INDUSTRIES, AND HOW TOO WE GET THE WORK FORCE READY TO TAKE ADVANTAGE OF THAT?

>> OUR INSTITUTIONS OF HIGHER EDUCATION HERE IN SOUTH JERSEY, WHETHER IT BE OUR UNIVERSITIES IN ROWAN UNIVERSITY, STOCKTON UNIVERSITY, RUTGERS, CAMDEN, OR OUR COUNTY COLLEGES ALL THROUGHOUT THE REGION, ARE REALLY DOING FANTASTIC THINGS CREATING PROGRAMS AND CREATING BRAND-NEW SUPPORTED PROGRAMS SPECIFICALLY GENERATED TO GETTING OUR EDUCATED STUDENTS IN THESE TRACKS WHETHER IT BE WIND, WHETHER IT BE E-SPORTS, WHETHER IT BE CON DIS.

-- CANNABIS.

MAKING SURE THEY HAVE THE TOOLS AT THEIR DISPOSAL SO WHEN THEY FINISH THEIR EDUCATION THEY CAN BE PERFECTLY PLACED INTO ONE OF THESE WELL-PAYING JOBS IN EXCITING NEW INDUSTRIES.

AT THE END OF THE DAY IT ENDS UP BEING HAS TO BE A COMBINATION BETWEEN THE BUSINESS DEVELOPMENT, THE ECONOMIC LANDSCAPE, AND OUR EDUCATIONAL INSTITUTIONS HERE IN SOUTH JERSEY.

>> CHRISTINA, SO GOOD TO CATCH UP WITH YOU.

THANKS FOR YOUR TIME.

>> ALWAYS, ANY TIME, RHONDA.

THANKS SO MUCH.

>>> ONE OF THE BIGGEST CHALLENGES FOR BUSINESSES IS GETTING CAPITAL, LOANS AND OTHER FUNDS TO BUILD AND GROW A BUSINESS.

AS WE'VE REPORTED ON EXTENSIVELY THIS IS ESPECIALLY IN MINORITY COMMUNITIES.

UCEDC HELPS SMALL BUSINESSES SECURE LOANS AND WAS RECENTLY HONORED WITH A DEI TRAILBLAZER AWARD FOR ITS WORK.

THE AWARD HANDED OUT BY THE NEW JERSEY CHAMBER AND AFRICAN AMERICAN CHAMBER OF COMMERCE RECOGNIZES ORGANIZATIONS THAT ARE LEADING THE WAY IN DEMONSTRATING TANGIBLE AND MEASURABLE PROGRESS IN DIVERSITY, EQUITY, AND INCLUSION.

I SAT DOWN WITH UCEDC PRESIDENT ADAM FARRAH TO REFLECT ON THE ORGANIZATION'S WORK THIS YEAR AND FOCUS ON WHAT'S AHEAD FOR NEXT YEAR.

ADAM, THANKS FOR JOINING ME ON "NJ BUSINESS BEAT" TODAY.

>> THANKS FOR HAVING ME.

>> YOUR ORGANIZATION WAS RECENTLY LAUDED, IF YOU WILL, GIVEN AN AWARD FOR DEI EFFORTS BY SOME OF THE CHAMBERS OF COMMERCE IN NEW JERSEY.

WHY IS DEI AND ACCESS TO CAPITAL LINKED IN TERMS OF AN IMPORTANT FACTOR?

>> MINORITY OWNED BUSINESSES, LGBTQ BUSINESSES HAVE TRADITIONALLY LACKED THE ACCESS OR RESOURCES THAT OTHER BUSINESSES HAVE HAD.

SO WE HAVE WORKED TO TARGET OUR MARKETING AND TO DEVELOP PROGRAMS THAT WOULD ALLOW FOR BETTER FUNNELLING OF ACCESS TO OUR PROGRAMS FOR THOSE TYPES OF BUSINESSES.

>> SO GIVE ME AN EXAMPLE OF SOME OF THE MARKETING OR HOW YOU STEPPED UP YOUR OUTREACH EFFORTS SO THAT YOU WERE ABLE TO HAVE PEOPLE FIND YOU AND KNOW THAT THERE WAS FUNDING, A FUNDING PATH AVAILABLE.

>> SO THE FIRST THING WE DID, A COUPLE YEARS BACK WE FORMED A DIVERSITY ADVISORY COMMITTEE TO TRY TO HELP STAFF AND OUR BOARD GAIN BETTER INSIGHT AS TO WHERE WE MIGHT BE MISSING THE MARK IN TERMS.

OUR MARKETING AND GETTING THE WORD OUT.

I THINK WE HAPPEN TO BE ONE OF THE BEST KEPT SECRETS OUT THERE FOR SMALL BUSINESSES.

ONE OF THE RESULTS, A COUPLE OF RESULTS OF DOING THAT WAS THE CREATION OF A COUPLE OF NEW PROGRAMS.

ONE IS CALLED OUR VIRTUAL INCUBATOR PROGRAM WHERE WE RUN A COURSE COUPLE TIMES A YEAR, WE'VE DONE IT FOR TWO YEARS NOW, WHERE WE SELECT A GROUP OF 10 TO 12 MINORITY-OWNED BUSINESSES AND PUT THEM THROUGH AN EIGHT-WEEK TRAINING COURSE WHERE WE HELP THEM WITH STRENGTH, WEAKNESS, AND OPPORTUNITIES AND THREAT ANALYSIS, HELP THEM BUILD A MARKETING PLAN, HELP THEM UNDERSTAND THEIR BUSINESSES A LITTLE BETTER AND WHERE THEY -- WHERE THEY FALL IN THE GRAND SCHEME OF THINGS AND HOW THEY CAN BECOME MORE EFFICIENT AND HOPEFULLY GROW.

ONE OF THE NICE THINGS ABOUT THIS IS IT COMES WITH AN ADDITIONAL COUPLE YEARS OF ONE-ON-ONE FREE MENTORING, AND WE ALSO PROVIDE FOLKS WHO GO THROUGH THE COURSE WITH A $5,000 FORGIVABLE LOAN WHICH IS A PRETTY NICE THING TO BE ABLE TO OFFER.

I'M NOT AWARE OF ANYONE ELSE DOING THAT.

ANOTHER PROGRAM THAT WE HAVE THAT'S VERY SIMILAR IS ENTREPRENEURSHIP AS A SECOND CHANCE.

PRETTY MUCH THE SAME SETUP AS THE VIRTUAL INCUBATOR PROGRAM EXCEPT WE'RE TAKING FOLKS WHO WERE PREVIOUSLY INCARCERATED WHO HAVE BEEN OUT FOR AT LEAST A YEAR, WHO HAVE KIND OF ESTABLISHED SOME OF THEIR BASIC LIVING REQUIREMENTS, HAVE EITHER SOME PART TIME OR FULL-TIME INCOME, BUT HAVE AN ENTREPRENEURIAL BACKGROUND OR HAVE AN IDEA THAT THEY'D LIKE TO TURN INTO A SMALL BUSINESS.

>> AS YOU LOOK AHEAD TO 2023, WHAT DO YOU HOPE TO ACCOMPLISH IN TERMS OF CONTINUING TO PROVIDE ACCESS TO CAPITAL?

>> I THINK HAVING NOT JUST ACCESS TO CAPITAL BUT AFFORDABLE ACCESS TO CAPITAL IS GOING TO BE KEY IN '23 FOR SMALL BUSINESSES IN NEW JERSEY.

THAT IS MAJOR ROLE THAT WE'RE GOING TO CONTINUE TO PLAY, WE'LL GOING TO OFFER THE SAME ENTREPRENEURIAL TRAINING PROGRAMS I MENTIONED BEFORE AND CONTINUE TO GET GREATER CAPITAL OUT INTO THE STREET WHERE IT'S NEEDED.

>> ADAM, IT'S BEEN SO INTERESTING TO HEAR WHAT'S GOING ON, AND THANKS AGAIN FOR YOUR TIME.

WISHING YOU THE BEST NEXT YEAR.

>> THANK YOU SO MUCH.

APPRECIATE THE OPPORTUNITY.

>>> IT'S BEEN SAID THAT NEW JERSEY HAS AN AFFORDABLE HOUSING CRISIS.

ONE ORGANIZATION TRYING TO CHANGE THAT IS NEW JERSEY COMMUNITY CAPITAL, ALSO KNOWN AS NJCC.

IT'S THE LARGEST COMMUNITY DEVELOPMENT FINANCIAL INSTITUTION IN THE STATE.

NJCC'S MISSION IS TO REVITALIZE NEIGHBORHOODS AND MAKE COMMUNITIES MORE EQUITABLE AND INCLUSIVE.

ONE WAY THAT'S DONE IS BY PROVIDING FINANCING TO DEVELOPERS ENCOURAGING THEM TO BUILD AFFORDABLE HOUSING ACROSS THE STATE.

I GOT A PROGRESS REPORT FROM NJCC'S PRESIDENT AND CEO, BRUNELL HALL.

GREAT TO TALK TO YOU TODAY.

>> GREAT TO BE HERE.

THANKS FOR HAVING ME.

>> AS THIS YEAR COMES TO A CLOSE AND WE LOOK TO NEXT YEAR, HOW WOULD YOU DESCRIBE SOME OF THE STRUGGLES WE SEE IN COMMUNITIES TO PROVIDE AFFORDABLE HOUSING HERE IN NEW JERSEY?

>> THERE ARE INTRINSIC ISSUES IN NEW JERSEY BECAUSE OF ITS IDEAL LOCATION.

IT'S VERY EXPENSIVE NOT ONLY TO RENT HERE BUT ALSO TO BUILD HERE, AS WELL.

SO YOU KNOW, IT TAKES A LOT OF EFFORT TO PROVIDE AFFORDABLE HOUSING.

AND AT THIS TIME EACH WITH OUR BEST EFFORTS, THERE'S ROUGHLY A 200-UNIT SHORTAGE IN AFFORDABLE HOUSING IN THE STATE WHERE 36% OF ITS RESIDENTS RENT.

>> SO YOU FOCUS IN PART ON THE LENDING EFFORTS.

TELL ME ABOUT YOUR EFFORTS TO PROVIDE SOME HELP, TO MAKE A DIFFERENCE IN THESE COMMUNITIES.

>> NEW JERSEY COMMUNITY CAPITAL IS A 35-YEAR-OLD COMMUNITY DEVELOPMENT FINANCIAL INSTITUTION BASED HERE IN NEW BRUNSWICK.

WE'VE REALLY FOCUSED ON LENDING TO REAL ESTATE DEVELOPERS THAT PROVIDE LOW AND MORT MODERATE INCOME IN THE STATE OF NEW JERSEY.

WE COMMITTED $47 MILLION THE LAST YEAR AND 68 LOANS THROUGHOUT THE STATE OF NEW JERSEY TO REALLY FOCUS ON PROVIDING MORE LOW-INCOME HOUSING IN THE STATE.

>> WHAT ARE SOME OF THE SUCCESS STORIES YOU HAD THIS PAST YEAR?

>> MOST RECENTLY WE PROVIDED $9 MILLION IN NEW MARKET CREDIT TO A $300 MILLION TRANSIT ORIENTED DEVELOPMENT IN EAST ORANGE, THE BRICK CHURCH STATION TO BE EXACT.

THAT'S GOING TO BE A COMBINATION OF AFFORDABLE HOUSING, RETAIL, AND ENTERTAINMENT IN A LOCATION THAT IS NEAR A TRAIN STATION BUT HAS GONE MANY DECADES WITHOUT HAVING THAT TYPE OF SPARK.

OUR IDEA THERE IS THAT PEOPLE IN LOWER TO MODERATE INCOME COMMUNITIES DESERVE A 24/7 LOCATION WHERE THEY CAN LIVE, WORK, AND PLAY IN THE SAME AREA IN WHICH THEY GREW UP.

>> DO YOU FIND THAT DEVELOPERS REALLY DO WANT TO MAKE A DIFFERENCE, THEY WANT TO PUT AFFORDABLE HOUSING IN PLACE, BUT FOR THEM IT'S REALLY JUST THE COST EQUATION THAT THEY CAN'T AFFORD TO DO IT WITHOUT SOME HELP?

>> THERE ARE A LOT OF FACTORS THAT GO INTO BUILDING AFFORDABLE HOUSING, NOT TO MENTION THE RISING CONSTRUCTION COSTS ASSOCIATED WITH INFLATION.

BUT ALSO REALLY JUST THE COST MAINTAIN AFFORDABLE HOUSING WHICH TENDS TO HAVE HIGHER MAINTENANCE COSTS THAN TRADITIONAL HOUSING.

AND DEVELOPERS OBVIOUSLY DEVELOP TO A PROFIT.

AT TIMES YOU'LL HAVE A SITUATION WHERE PROFITS RUN IN THE FACE OF JUST GOOD INVESTMENT EFFORTS FOR SOCIAL IMPACT.

IN THOSE CASES PEOPLE LIKE -- SORRY, ORGANIZATIONS LIKE NEW JERSEY COMMUNITY CAPITAL HAVE TO PROVIDE LOW-COST FINANCING TO DEVELOPERS, ALSO WITH THE GOVERNMENT, SO THAT WE CAN SUBSIDIZE A DEVELOPMENT OF AFFORDABLE HOUSING THROUGHOUT THE COMMUNITIES THAT NEED IT MOST.

>> MAYBE WE SHOULD CLARIFY FOR PEOPLE WHO ARE NOT AWARE, WHEN WE SAY AFFORDABLE HOUSING, THIS IS NOT WHAT IT WAS BACK IN THE DAY DECADES AGO.

THESE ARE NICE UNITS THAT LOOK GREAT IN A COMMUNITY AND REALLY WEAVE INTO THE FABRIC OF A COMMUNITY.

>> YES.

YOU'RE EXACTLY RIGHT.

I MEAN, SINCE THE '80s, MOST LARGE METRO AREAS HAVE MOVED AWAY FROM TRADITIONAL PUBLIC HOUSING, ALTHOUGH IT'S OBVIOUSLY VERY NEEDED WHERE YOU CONCENTRATED A LOT OF LOW-INCOME RESIDENTS.

YOU SEE MORE GARDEN-STYLE AFFORDABLE AND MIXED INCOME HOUSING WHERE PEOPLE OF VARIOUS INCOMES LIVE AND WILL WORK TOGETHER.

SO THERE'S JUST NO DIFFERENCE, RIGHT, YOU'RE NOT CREATING AN IMPOVERISHED AREA WHERE THE QUALITY OF LIFE IS QUESTIONABLE.

YOU'RE CREATING AN AREA WHERE PEOPLE OF LOW INCOME, PEOPLE WITH HIGHER INCOMES WORK, LIVE, AND PLAY TOGETHER, AND REALLY CREATE COMMUNITY.

>> ARE WE GOING TO GO COME CLOSER TO SOLVING NEW JERSEY'S AFFORDABLE HOUSING CRISIS IN 2023?

>> WE HAVE A LOT OF GOOD PARTNERS, THE STATE OF NEW JERSEY, OTHER NONPROFITS AS WELL AS OUR FINANCIAL INSTITUTION PARTNERS, BUT THERE IS A 200-UNIT AFFORDABLE HOUSING SHORTAGE IN NEW JERSEY.

THAT'S THE METRIC THAT GETS US UP IN THE MORNING.

THAT'S THE METRIC WE'RE TRYING TO BRING DOWN.

WE THINK THAT WE CAN.

WILL IT BE ELIMINATED, NO, BUT WE BELIEVE THAT WITH OUR BEST EFFORTS AND A LOT OF INNOVATION WE'LL BRING THAT NUMBER DOWN SIGNIFICANTLY OVER THE NEXT 12ER TO 18 MONTHS.

>> THANKS FOR YOUR HELP AT GETTING THAT DONE.

GOOD TO TALK TO YOU.

>> A PLEASURE SPEAKING TO YOU, AS WELL.

>>> THAT DOES IT FOR US THIS WEEK.

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WE WISH YOU A VERY HAPPY HOLIDAY SEASON, AND MANY GOOD THINGS TO COME IN 2023.

THANKS AGAIN FOR WATCHING, AND WE'LL SEE YOU NEXT YEAR.