On Sept. 8 President Obama addressed a joint session of Congress to present the American Jobs Act. In his speech the president outlined tax breaks for individuals and small businesses, funding for infrastructure projects and an extension of unemployment benefits. But the looming question remains: will these moves actually create jobs?
There is no doubt that upgrading our transportation infrastructure and renovating schools is a well needed and positive step to improve both systems. However, it’s hard to argue this is a long-term job creation strategy, or even short-term for that matter. Keep in mind that many of the “shovel-ready” projects touted in the 2009’s stimulus package weren’t so shovel ready.
Reducing tax burdens will certainly help ease the financial burden on small business owners, however, these temporary tax cuts will more likely serve to help small business owners survive as opposed to thrive. In an opinion piece in this last Sunday’s New York Times, professor Robert Barro of Harvard University pointed out that “hiring decisions take into account the long-run economic climate” and the tax incentives in the president’s plan are short term, and do little to provide any certainty. The reality is that businesses both large and small are holding back hiring new staff partly due to the uncertainty of our economic future.
Here are some thoughts about where we should be concentrating our efforts:
Fill the Jobs We Have
The 2011 Manpower Talent Shortage Survey found that 52% of U.S. employers surveyed could not fill mission-critical jobs. In other words, more than half of these companies say they have jobs and can’t staff them.
Among the top five hardest jobs to fill: skilled trades, sales representatives, engineers, drivers and accounting/finance staff. To meet these needs in the short term, companies are going to need to work on retaining highly-trained staff and even bringing back retired employees.
In the midterm, we have to remember that a great number of industries in this country were decimated by the Great Recession leaving millions of Americans out of work with no real options. To tap into the raw talent of these individuals, companies will need to develop custom, in-house training and mentoring programs designed to grow new talent into these hard-to-fill positions. In the longer-term we need to engage and incentivize community colleges and vocational schools to partner with local American companies to develop educational programming designed to fill the needs of local employers. A lengthy and expensive liberal arts education isn’t for everyone. Many communities are starving for practical training that has a clear path to a job.
Incentivize Getting Back to Work
The “Bridge to Work” program mentioned in Obama’s plan certainly has some promise. Based on a program in Georgia, the idea is to extend unemployment benefits to those who take unpaid positions with companies designed to give them an opportunity to re-enter the workforce and build new skills. Any extension of unemployment benefits should tie-in back-to-work incentives.
The administration should also encourage and incentivize internship and apprenticeship programs, not just for college students, but for experienced job seekers as well. Internships allow companies to test drive potential new hires with little risk; not to mention many companies end up hiring their interns.
Hiring is an expensive proposition and as someone who has developed hiring processes for companies, I can attest to the fact that being able to test drive a prospective employee can save companies substantial sums of money while also providing a great opportunity for the job seeker.
Create Demand
We need to create demand for American products and services at home and abroad. We have some of the most well-educated, hardest working people in the world, yet we continue to lose our manufacturing base. Although he tipped his hat to manufacturing, there doesn’t appear to be much in what the president proposed to actually deal with the issue. According to the Center for American Progress, the number of Americans working in manufacturing today is less than 12%. In contrast, this number was around 30% in the 1970s.
The fall off of manufacturing in this country isn’t a surprise. Consider when Boeing, America’s largest manufacturer, came under assault from the National Labor Relations Board for seeking to open a plant that would create 3,800 jobs in South Carolina, a right-to-work state. Anti-manufacturing moves like this only serve to hinder job creation by driving companies out of this country. At some point the administration needs to recognize this.
Most economists agree that we have a demand issue. Until there is a demand for goods and services people aren’t going to spend, and companies aren’t going to hire. Consumer confidence also remains near an all-time low, which means that it’s going to be tough to get American’s spending. I’m certainly not an economist and I realize that no solution will be easy. However, we have to start getting practical and demanding that both government and private sector leaders go beyond political gimmicks and start offering real solutions.
Michael “Dr. Woody” Woodward, PhD is a CEC certified executive coach trained in organizational psychology. Dr. Woody is author of The YOU Plan: A 5-step Guide to Taking Charge of Your Career in the New Economy and is the founder of Human Capital Integrated (HCI), a firm focused on management and leadership development. Dr. Woody also sits on the advisory board of the Florida International University Center for Leadership. Follow Dr. Woody on Twitter and Facebook
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