By Jason Bramwell, Staff Writer
CPAs in New Jersey, New York, and Pennsylvania believe economic conditions in the United States will likely be the same one year from now, and while they predict higher business revenues for their states next year, they don't have the same optimism for workforces in those three locations, according to a survey released December 5.
"CPAs have identified several key issues that are preventing a jumpstart in the economy," NYSSCPA Executive Director Joanne Barry said in a written statement. "As business leaders in their communities, CPAs are on the front lines in terms of spotting and reacting to economic trends."
About half of CPAs in all three states – 52 percent in Pennsylvania and 46 percent in both New Jersey and New York – believe current economic conditions in the United States are about the same as they were one year ago. Less than half of respondents – 47 percent in Pennsylvania, 44 percent in New York, and 39 percent in New Jersey – expect the economy to be about the same at this time next year.
What factors are driving this less-than-optimistic outlook of the US economy? CPAs in New York and New Jersey blamed high unemployment (49 percent and 54 percent, respectively) and entitlement spending (38 percent and 40 percent, respectively) for the lack of economic growth. Pennsylvania CPAs singled out the Affordable Care Act (43 percent), high unemployment (42 percent), entitlement spending (42 percent), and federal regulations (42 percent) as all having a negative effect on the economy's health.
The forecast looks brighter, though, for business revenue growth in each of the three states over the next twelve months. Fifty-five percent of Pennsylvania and New York CPAs expect a surge in revenues in their states, while 48 percent of New Jersey CPAs have the same sentiment.
However, CPAs in New Jersey (23 percent), New York (24 percent), and Pennsylvania (28 percent) do not have as optimistic of an outlook for employment increasing in their states in 2014.
In New Jersey, 54 percent of CPAs believe the economy in their state has stayed stagnant over the past year, and 50 percent do not expect much of a change over the next twelve months.
Reducing property tax rates (39 percent) and reforming state government pensions and benefits (36 percent) are the top two factors CPAs in New Jersey believe would improve economic expansion in their state.
"Overall, the numbers are going in the right direction, but it's a daily battle," NJSCPA CEO and Executive Director Ralph Albert Thomas said. "Our hope is that the federal and state governments will do their best to mitigate risk and uncertainty and continue to reach out to business groups – such as CPA societies – for feedback when considering pro-business policies."
In New York, 40 percent of CPAs believe the economic conditions in their state are about the same as one year ago, and 43 percent expect the economy to be about the same one year from now.
In Pennsylvania, 28 percent of CPAs said economic conditions in their state are better now compared to this time last year.
The top factors that CPAs believe could provide for greater economic expansion and job growth potential in Pennsylvania are reforming state government pensions and benefits (32 percent) and increasing investments in repairs and upgrades to infrastructure, such as roads and transportation systems (17 percent).
"CPAs have unique insight into the business community through their work in public accounting serving multiple clients and in industry where they work with other C-suite executives," PICPA CEO and Executive Director Michael Colgan said. "This survey shows that our members are projecting growth in revenues in the coming year, which should translate into continued growth across multiple sectors of the state's economy."
About the survey:
There were 673 responses from New Jersey CPAs who are members of the NJSCPA, 451 responses from New York CPAs who are members of the NYSSCPA, and 869 responses from Pennsylvania CPAs who are members of the PICPA. Survey invitations were sent to 4,499 CPAs in New Jersey, 5,780 CPAs in New York, and 4,461 CPAs in Pennsylvania.