New Jersey’s military bases drive economic activity

Gov. Phil Murphy stressed the importance of the state’s military at the 177th Fighter Wing in Atlantic City. It was the second stop on a tour of the state’s military bases led by the New Jersey Department of Military and Veterans Affairs.

Rep. Donald Norcross and members of New Jersey’s Congressional delegation joined Murphy as he spent the day touring five state bases.

“From Picatinny, Earl, Joint Base McGuire, the Coast Guard base, and here at the 177th have dozens and dozens of suppliers that support it. It has a tremendous impact on New Jersey for those who work here and provide us security,” said Norcross.

According to the New Jersey Department of Military and Veterans Affairs, New Jersey bases employ 70,000 residents every year.

The military is the state’s second largest employer and brings more than $6 billion in economic benefit to the state. Of that, $3.8 billion comes from direct economic impacts and an additional $2.7 billion is from indirect economic impacts.

For business owners, military presence can mean the difference between keeping a business open or closing it.

“If they close down, I don’t know what could happen. It could mean we are not going to survive either. I have been here for 19 years and I’ve never seen anything more developed around, outside the base. We have to survive on the measure of the military people so that’s a big effect,” said Hiren Patel, owner of Lodge Inn, a motel near the Joint Base McGuire-Dix-Lakehurst in Wrightstown.

Joint Base McGuire-Dix-Lakehurst is home to more than 42,000 airmen, soldiers, sailors, Marines, Coast Guardsmen, civilians and their family members living and working on and around the base.

According to the Department of Defense, in 2017 military bases enlisted 7,669 New Jersey active duty military, 16,973 reserve forces and 9,985 military civilians.

“In Germany we have a lot of military bases so my husband decided this is a good place to open up a German restaurant. And it’s very successful because we have 60% to 70% military that comes here,” said Krystyna Wittmann, owner of Sebastian’s Schnitzelhaus.

Wittmann says her livelihood is based off business from military men and women and that’s why she goes out of her way to fill the German restaurant with American themed decorations. It’s filled with personal photos of military families on tables and even photos and gifts from military men and women who visit her establishment.

“What makes me happy is when the children come in here and they say ‘Oh my god,’ looking around like their grandmother’s house. It make me so happy. If we don’t have a military base here, we are in trouble in Wrightstown. All the businesses around us,” she said.

Mike Lahr, director of the Rutgers Economic Advisory Service at the Edward J. Bloustein School of Planning and Public Policy, published a study in 2013 on how the state’s military and Coast Guard facilities contribute to the state economy.

“None of these bases are at the edge of the state, so they’re not commuting into the state, they actually live within the state for the main part. So this all builds up that part of the economy in what we call induced effects in the economy — household spending and all the jobs and supply chain related to the things that households buy,” said Lahr.

He says major federal assets in New Jersey are the military bases that remain. But according to the study, New Jersey received less funding from the federal government than its businesses and households send to Washington, D.C. in the form of taxes and fees.

“Just show the spending per state and the returns, the tax collections per state, to show where New Jersey ranked, and we were at the bottom of that list out of 50 states. But what are the strong ties are the salaries of the people in the state, and anybody who connected with the base. For example, at Picatinny they tend to have higher than average salaries, same thing at Lakehurst, and it was the same thing at Monmouth,” he said.

But Lahr says the bases continue to contribute substantially to the state’s economy.

“If we are building new buildings on the bases, if we’re laying down new tarmac at McGuire, those jobs are certainly allocated to the state, and moreover since they’re in the senator’s state, it’s unlikely we’re importing labor from other states. There’s a construction crew on the base for many of the buildings, but there are certain things like electrical work and so forth where sometimes they let people from the outside come in and do that. So those are people who are also employed here. And if they do, they shift from base to base, but while they’re here their housing is here, they have to eat food here and so forth,” Lahr said.

That spending creates the need for infrastructure being built for those who live both on and off the base.

“So you may have somebody who’s a schoolteacher who is married to somebody at the base, or someone else who is working at a high-tech firm who then also has a spouse working in the military. The point is if some from the military left, those people likely would leave too,” he said.

Lahr says ultimately anytime a military base is closed it puts an entire community’s economy at risk. The governor says the tour will provide him with better insight on what installations and resources are needed to keep the bases from shutting down.