At Contractor News, we have been reporting extensively on how the different state and local administrators are taking proactive initiatives to reduce any barriers for small businesses to access government contracts. The state of New Jersey is the most recent in the line of conducting a Disparity Study.

New Jersey Governor Phil Murphy and Treasurer Elizabeth Maher Muoio have released a comprehensive statewide disparity study examining public contracting opportunities for Minority and Women-Owned (MWBE) businesses. The study by Mason Tillman and Associates (MTA) reviewed procurement data over five years and found significant disparities in awarding public contracts across multiple minority-owned and women-owned business enterprises (M/WBE).

This is the first disparity study since 2005, in which MTA reviewed over 1.2 million records and 240,000 contracts from over 60 contracting agencies.

Key findings from the study include statistically significant disparities in contracting with Minority Business Enterprises, including businesses owned by Black Americans, Asian Americans, and Hispanic Americans, for formal prime contracts in construction, professional services, and goods and services. Similarly, disparities were found in contracting with Woman Business Enterprises, including businesses owned by Caucasian females. The study also highlighted the overutilization of businesses owned by non-minority males across all areas studied.

In response to the study, Governor Murphy stated, “In New Jersey, our diversity is our greatest strength, and it is imperative that our procurement processes reflect these values.” Treasurer Muoio added, “The completion of this study marks a critical step in achieving the State’s goal of identifying and addressing disparities in public contracting.”

The Office of Diversity and Inclusion within the Department of the Treasury oversaw the study. These findings are likely to influence how New Jersey approaches major projects, including the New Jersey DOT's $4.5b capital improvements program.

Following the completion of the study, the Administration plans to work with lawmakers and the business community to identify responsive state action to address the disparities in state contracting. Senate President Nicholas Scutari emphasized the importance of providing equal opportunities for all businesses, stating, “Businesses run by women, minorities, disabled veterans, and others who have been denied equal treatment should have the opportunity to fully participate in the procurement process.”

Many business groups participated in a hearing at the State House in Trenton for a Senate Economic Growth Committee meeting to discuss the findings of the Disparity Study and the post-pandemic economic conditions. While some groups sounded the clarion call, others demanded for a more middle-ground approach.