Employers on strike

While the government has been on a hiring binge, spending our future into the toilet, private industry (the wealth creators) employment has been stagnant. Despite the claims of being focused on “jobs, jobs, jobs,” congress and the regime haven’t done anything to stimulate private sector employment. In fact, they’ve done a lot to kill private sector employment. (story here from the WSJ)

Almost everything Congress has done in recent months has made private businesses less inclined to hire new workers. ObamaCare imposes new taxes and mandates on private employers. Even with record unemployment, Congress raised the minimum wage to $7.25, pricing more workers out of jobs. The teen unemployment rate rose to 26.4% in May, and for those between the ages of 25 and 34 it rose to 10.5%. These should be some of the first to be hired in an expansion because they are relatively cheap and have the potential for large productivity gains as they add skills.

The “jobs” bill that the House passed last week expands jobless insurance to 99 weeks, while raising taxes by $80 billion on small employers and U.S-based corporations. On January 1, Congress is set to let taxes rise on capital gains, dividends and small businesses. None of these are incentives to hire more Americans.

Ms. Romer said yesterday that to “ensure a more rapid, widespread recovery,” the White House supports “tax incentives for clean energy,” and “extensions of unemployment insurance and other key income support programs, a fund to encourage small business lending, and fiscal relief for state and local governments.” Hello? This is the failed 2009 stimulus in miniature.

It’s always a mistake to read too much into one month’s jobs data, and we still think the recovery will lumber on. But if Ms. Romer wants this to be more than a jobless recovery, she and her boss should drop their government-creates-wealth illusions and start asking why so many private employers remain on strike.

How true. Will they ever get it?

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2 Responses to “Employers on strike”

  1. Good point of view. As a business owner of a real estate company who is just finally going into the black after 3 years I am afraid to hire because the net dollars I am getting after taxes (including workers comp, unemployment benefits, etc.) is continually being reduced even as the gross dollars go up. And it is just going to keep going.

    And the additional taxes I am paying go towards inflated guaranteed government jobs. I just read an article from USA today that the average government salary with benefits is twice as much as it’s private counter part. WHAT IS THAT ABOUT???

    In addition to the added liabilities that come with owning your own company the government is giving me absolutely no incentive to hire. It ends up creating a catch 22 for business owners. You need employees on your team to grow but it now creates additional costs that are much harder to offset because of the reasons stated above.

    • What amazes me is that the government and state-run media wonder why unemployment remains so high after proclaiming that the recession is over. All they have to do is ask a business owner like you and they would find out. Yours is the real story.

      Thanks for the comment. Hang in there…

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