Solving NJ affordability crisis requires bold policy changes, advocates say

Rising costs and cuts to federal safety net programs are putting more pressure on New Jersey families.

New Jersey’s affordability crisis goes far beyond rising housing costs, utility bills and child care expenses, with stagnant wages, growing income inequality and government policies making it increasingly difficult for working families to get by, experts said Tuesday.

At a forum in Newark, leaders from four New Jersey policy and advocacy organizations called for changes to state economic and social policies, including measures to raise wages, expand public assistance and increase taxes on wealthy residents and corporations to help pay for those investments.

The discussion was part of the Fund for New Jersey’s 2026 Crossroads New Jersey Democracy Forum, held Oct. 13 at the New Jersey Performing Arts Center in Newark. The event brought together policy experts, advocates and community leaders to discuss challenges facing the state and the country.

Panelists argued that New Jersey needs to treat housing, health care, child care, wages and environmental conditions as interconnected problems rather than separate policy issues.

“There’s a lot of discussion about affordability as, oh, we have to lower prices. But we could also raise wages,” said Peter Chen, president of New Jersey Policy Perspective, a progressive think tank.

Chen said inflation-adjusted wages for the bottom 20% of earners have increased approximately 30% since 1980, compared with roughly 300% for the top 1%.

While New Jersey cannot control federal tariffs or other national economic policies, state lawmakers can pursue policies that increase wages and provide services that reduce the financial burden on working families, he said.

The hidden costs of child care

Meghan Tavormina, director of public policy and advocacy at the New Jersey Association for the Education of Young Children, described how families earning what might appear to be comfortable middle-class incomes can still struggle to pay for basic necessities.

She pointed to a hypothetical family of four earning $85,000 annually with two young children.

According to the latest United Way research, a New Jersey family with two adults, an infant and a preschooler needed an estimated $115,872 annually in 2024 to cover basic expenses, including housing, child care, food, transportation and health care. The statewide estimate varies by county.

That leaves a gap of more than $30,000 for the hypothetical family before accounting for vacations, college savings, or building wealth.

Tavormina said New Jersey’s Child Care Assistance Program has an income eligibility threshold of approximately $66,000 for a family of four, leaving families earning slightly more without assistance despite the high cost of care.

The program limits initial eligibility to families earning no more than 200% of the federal poverty level, although families already receiving assistance can remain eligible at higher incomes.

Tavormina estimated that infant care can cost $20,000 annually.

The consequences extend beyond immediate household expenses. Mothers who leave the workforce because they cannot afford child care may lose wages, career advancement opportunities, and retirement contributions, she said.

Grandparents are also increasingly being asked to provide unpaid child care, creating financial pressures across generations.

Tavormina urged lawmakers to treat child care as essential economic infrastructure and expand state assistance while improving wages for child care workers, who are among the lowest-paid workers in New Jersey.

Making care affordable for parents without addressing the workforce shortage would leave families with few options, she warned.

Federal cuts threaten household budgets

Maura Collinsgru, director of policy and advocacy at New Jersey Citizen Action, said the state’s affordability problems are likely to worsen as federal funding reductions and new eligibility requirements take effect.

According to United Way’s latest research, the people in about 39% of New Jersey households, nearly 1.4 million households, either live in poverty or earn more than the federal poverty threshold but cannot afford basic necessities.

The latter group is known as ALICE households, an acronym for Asset Limited, Income Constrained, Employed.

“So, when we talk about affordability, not just Citizen Action, but many of our coalition partners in For the Many, we talk about affordable for who,” Collinsgru said. “That’s a choice. Who is New Jersey affordable for?”

She warned that federal policy changes could cause about 300,000 New Jersey residents to lose Medicaid coverage.

The New Jersey Department of Human Services estimates that enrollment losses could reach 330,000 by fiscal 2029, with annual federal funding losses attributable to declining enrollment potentially reaching $3.3 billion by fiscal 2030.

Collinsgru called on state officials to establish a free or low-cost public health insurance option for people losing Medicaid coverage, to expand the state’s child tax credit, and invest in technology and staffing needed to administer public assistance programs.

She also criticized the federal Medicaid work requirements scheduled to take effect Jan. 1, 2027, for certain adults enrolled in NJ FamilyCare, arguing that they could prevent unemployed residents from obtaining health coverage when they need it most.

Pollution is an affordability issue, too

Hazel Applewhite, CEO of Newark-based Ironbound Community Corporation, said discussions about affordability often overlook the economic consequences of pollution in low-income communities.

Families living near incinerators, power plants and heavily traveled trucking routes face health problems that can force them to spend scarce resources on medical care rather than rent, food or child care, she said.

“We often times don’t see pollution, again, as an economic issue,” Applewhite said.

Applewhite called for the passage of legislation known as the indirect source review bill, S2339 (formerly S3546 in the 2024-25 legislative session), which would require large warehouses, distribution centers, and other high-traffic facilities to obtain state permits and take steps to reduce truck-related air pollution.

She also called for more community solar projects, investments in renewable energy, and legislation requiring major polluters to contribute to funds benefiting communities harmed by pollution.

Who pays for the solutions?

The question of how to finance expanded services emerged as a central theme.

Chen argued that New Jersey needs to increase taxes on wealthy individuals and large corporations rather than forcing advocacy organizations to compete for limited funding during annual budget negotiations.

“I mean, there’s a solution to fund child care, to fund health care, to fund, clean enegy infrastructure, and it’s called taxation,” he said.

He criticized the tendency of nonprofit organizations to lobby for the restoration of individual budget appropriations without advocating for additional revenue.

“But this is just fighting over crumbs,” Chen said. “And every year the crumbs get smaller and smaller.”

During the audience question-and-answer session, a participant asked whether higher taxes would drive wealthy residents and corporations out of New Jersey.

Chen pointed to the state’s existing millionaires tax and continued demand for housing. He also noted that corporations can owe New Jersey taxes on income for business conducted in the state, regardless of where their headquarters are located.

The panelists emphasized that changing policy would require sustained public pressure, not just legislative proposals.

Tavormina called for a dedicated, long-term funding source for child care assistance, while Collinsgru urged residents to organize around state budget priorities and hold lawmakers accountable.

Chen said policymakers also need to hear directly from residents struggling to afford basic necessities rather than focusing primarily on the concerns of high-income taxpayers.

“How about having some legislators or executive branch employees come and see how a single mom balances a budget for a family of three?” Chen said.

The broader challenge, panelists said, is persuading policymakers and the public to view access to housing, health care, child care, and a healthy environment as shared priorities rather than just financial responsibilities of individuals.

The affordability discussion was one of three panel discussions.The conference also featured a keynote address by New York Times columnist Jamelle Bouie, who drew parallels between Northern states’ resistance to the demands of slaveholding states before the Civil War and efforts to challenge the Trump administration and the U.S. Supreme Court today. Bouie later participated in a discussion with Democratic Assemblywoman Katie Brennan of Hudson County and Democratic Assemblyman Chigozie Onyema of Newark.

Other panels explored voting rights, civic participation, and immigration. Participants included Jesse Burns, executive director of the League of Women Voters of New Jersey; Henal Patel, interim president and CEO of the New Jersey Institute for Social Justice; John Butler, political director of the ACLU of New Jersey; and Nedia Morsy, director of Make the Road New Jersey.

A discussion on immigration featured representatives of AAPI New Jersey, the Latino Action Network Foundation, the American Friends Service Committee and Wind of the Spirit Immigrant Resource Center.