Solve Unemployment by Paying Businesses to Invest in People

Yahoo Contributor Network
In this Wednesday, Dec. 12 2012 photo, Taneshia Wright, of Manhattan, fills out a job application during a job fair in New York. U.S. employers added 155,000 jobs in December, a steady gain that shows hiring held up during the tense negotiations to resolve the fiscal cliff.  The solid job growth wasn’t enough to push down the unemployment rate, which remained 7.8 percent last month, the Labor Department said Friday, Jan. 4, 2013. The rate for November was revised up from an initially reported 7.7 percent.  (AP Photo/Mary Altaffer)
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In this Wednesday, Dec. 12 2012 photo, Taneshia Wright, of Manhattan, fills out a job application during a job fair in New York. U.S. employers added 155,000 jobs in December, a steady gain that shows hiring held up during the tense negotiations to resolve the fiscal cliff. The solid job growth wasn’t enough to push down the unemployment rate, which remained 7.8 percent last month, the Labor Department said Friday, Jan. 4, 2013. The rate for November was revised up from an initially reported 7.7 percent. (AP Photo/Mary Altaffer)

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COMMENTARY | There is one concern that should be the primary focus of our president and Congress during this new legislative session: job creation.

According to the latest labor report, as of December 2012, 22.7 million Americans are unemployed, underemployed or marginally attached to the workforce. People want and need jobs. While there are programs to help the unemployed, such as unemployment insurance, as well as social programs such as food stamps and fuel assistance, these programs just help people scrape by; they are not a solution to the problem of long term unemployment. Long term unemployment leads to other problems that affect individuals and society.

The president and Congress must stop blaming one another or past administrations for economic problems and work together to solve this, because people want and need jobs, not hand-outs. Government should help businesses to hire the unemployed, since research shows there is a bias against laid off workers, by providing a tax credit to any business of any size, that hires someone who has been unemployed and has drawn unemployment benefits, exhausted unemployment benefits, or who has received any sort of government assistance within the last four years. To claim this credit, the business would have to keep this person working for at least 24 months, with the credit being claimed at one year and then two years of employment. This would give businesses an incentive to start hiring again and it would get people back into the workforce. The benefits to individuals, businesses and society as a whole would be enormous.

With more people working, more people would have earnings that could be taxed, which would lead to greater income for and solvency for social security as well as state and federal unemployment funds. It would lead to a reduction in the number of people dependent on government services such as TANF and food stamps. It would also help individuals in that it is always easier to get another job when you are already employed, and work skills are not becoming obsolete when you are employed. There are tremendous psychological benefits to working as well, as people tend to take better care of themselves, their families, and participate more actively in their communities when they have a job. Government gives businesses incentives to invest in alternative energy, why don't we give businesses an incentive to invest in our greatest resource -- our people?

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