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September 6, 2011

What Should We Look for in the President’s Jobs Speech?

September 6, 2011

On Thursday, September 8, President Obama will address a joint session of Congress. He is expected to deliver a “jobs speech” that the White House press office says will include “bipartisan proposals to rebuild the American economy by strengthening small businesses, helping Americans get back to work, and putting more money in the paychecks of the middle class and working Americans.”

The big question for many –especially those hardest hit by the recession--will be “How many of those in non-working America will have any paycheck as a result of the proposals?” The answer depends on what’s in the jobs package.

Unemployment hasn’t slammed all workers or regions equally. Some groups and some areas have suffered more than others.  In many communities, the recession just accelerated a decline that was already taking place. So what would a jobs program do for these groups and places?

A tax break for businesses that hire additional employees may spur employers who were on the brink of hiring to move ahead, but it probably won’t spark large-scale hiring in communities where economic expansion is not already afoot.  Likewise, incentives for innovation make sense and may put businesses that take the bait in a more competitive position globally, but the results may not register for several years.

Investment in infrastructure could generate up to 100,000 jobs in a year, based on statistics from the Transportation Department’s ARRA spending in the 10 months of that program.  But where these jobs go depends on the details of the deal.  Nearly every US community needs some kind of new infrastructure, but program funds would do the most good if distributed preferentially to communities with the highest unemployment rates.  And if the proposal is to help African American males— who have the highest unemployment rates and have been out of work longer than most—it must ensure equal access to the new jobs. Requiring minority subcontractors or monitoring affirmative action would help.

A complete jobs program would also feature measures to ensure that workers whose skills have grown rusty during extended joblessness will be attractive to employers and productive once hired.  Here the answer is a sizable increase in current or enhanced workforce training programs.

It’s rumored that some of these features might be in Obama’s package, but will the package be big enough to dent the problem?  And will a Congress seemingly keener to cut expenditures than to cut the jobless rate pass it if it is? All of us will have to wait and see. Meanwhile,  some of us have already been waiting far too long for another shot at employment.  

2010 Unemployment Rates and Duration of Unemployment, by Race, Ethnicity, and Gender, ages 16 and over (Annual Averages)

   

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