New Jersey Reveals Disparities in State Contracting Through New Study

Comprehensive Study Unveils Significant Gaps in Public Contracts Awarded to Minority and Women-Owned Businesses.

Governor Phil Murphy and Treasurer Elizabeth Maher Muoio disclosed pivotal findings from a comprehensive disparity study on public contracting for Minority and Women-Owned Businesses (MWBE) in New Jersey. The study, conducted by Mason Tillman and Associates, unveiled notable disparities across various sectors, including construction, professional services, and goods.

Initiated in 2020, this extensive study aimed to scrutinize MWBE participation in the state's contracting operations, exploring whether further measures are needed for a more equitable business landscape in New Jersey. "Our diversity is our greatest strength," Governor Murphy emphasized, acknowledging the study's crucial role in rectifying procurement process inequities, particularly for minority, women, and service-disabled veteran-owned businesses.

Treasurer Muoio highlighted the study's significance in addressing public contracting disparities, thanking the Office of Diversity and Inclusion, under Chief Diversity Officer Candice Alfonso, for its execution. Alfonso, acknowledging her predecessor Hester Agudosi, expressed determination to transform equitable opportunities for diverse businesses.

The study, a first since 2005, analyzed over 1.2 million records and 240,000 contracts from numerous agencies and institutions. It found glaring disparities in awarding contracts to Minority Business Enterprises, including businesses owned by Black, Asian, and Hispanic Americans. For instance, while minority-owned businesses constituted nearly 28% of available construction businesses, they received a mere 3.69% of prime construction contract dollars.

Similarly, Woman Business Enterprises, including those owned by Caucasian women, faced significant disparities in formal prime contracts across various industries. Despite representing over 37% of professional services businesses, these enterprises garnered less than 10% of prime professional service contract dollars.

The study also revealed an overutilization of businesses owned by non-minority males in all areas analyzed. The Office of Diversity and Inclusion, tasked with monitoring state procurement and contracting practices, oversaw the study, ensuring a broad community outreach for comprehensive input.

Governor Murphy's recent legislative move, revising the disabled veterans’ business set-aside contract requirements, aligns with these findings, reflecting his commitment to inclusive state contracting opportunities.

As the study concludes, it sets a foundational basis for future initiatives aimed at mitigating these disparities. Senate President Nicholas Scutari emphasized the need for fair participation opportunities in public procurement for historically marginalized groups.

The Murphy Administration, in collaboration with lawmakers and business communities, is poised to develop responsive strategies, ensuring equitable public contracting in New Jersey.