How do you see the state of the labor market? Are jobs really that hard to find and get, or is the situation exaggerated for political purposes?
Last week produced the Employment Situation Report for the month of July, and the report showed the unemployment rate stuck at a high level of 9.5%. Do you agree with the view of some politicians, mostly on the Republican side of the table, that the availability of employment insurance extensions are keeping some people from looking for jobs? Should these essential benefits be cut?
I personally know people who have chosen to stay on unemployment rather than take a new job or part-time work that would reward them only marginally, while placing them at risk of not qualifying for unemployment benefits again should they lose their part-time employment. If benefit extensions are keeping some Americans from looking harder for work, which is not the intended purpose, what would you suggest to help spur labor market participation? Is stopping unemployment benefits really a viable solution, or would that only force more foreclosures, tighten money belts even further, and drive a deeper recession? While I'm sure there are a handful of folks exploiting the situation, I view them as clear outliers. I believe it would be a major mistake to cut off unemployment benefits now. People without jobs would be forced to the welfare program, where income would be less than one-quarter of what they get from unemployment benefits.
Of course, the situation is not black and white, and there are surely a significantly higher majority of hard working, honest Americans who would gladly trade in their unemployment for a steady job. The Weekly Jobless Claims figures, ADP Private Employment Report and the Labor Department's Employment Report verify that companies are simply not hiring in a significant way. This favoritism toward cautious corporate investment is in turn affected by light consumer spending and less than optimal export demand. The President's efforts to spur small business hiring by offering tax incentives has not targeted the problem properly, because who would hire without revenues to justify the investment? What should the Administration do?
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