Fourth of July parades and barbecues can’t mask the nation’s the persistent jobs crisis as the economy continues its painfully slow recovery. Just last week Lockheed Martin, the Pentagon’s number-one supplier of military aircraft, ammunition and other equipment, announced it would slash about 1,500 jobs from its aeronautics unit in part because of looming cuts to U.S. defense spending. Lockheed joins the ranks of Gannett (700 layoffs) and the big banks, which are planning dramatic job cuts.
Add to the list scores of public workers, including teachers in cities like New York and Chicago who face layoffs as school budgets contract; local government employees, who continue to face declines; and the construction industry, which is telling workers to keep a lock on their tool chests as spending fell 0.6 percent in May. The unemployment rate remains stuck at 9.1 percent two years after economists say the Great Recession has ended. (The June jobs data will be released on Friday, July 8.)
Two tiny slivers of light in this less-than-rosy scenario: Manufacturing recovered slightly in June after a May slowdown, while oil prices are down from their recent high. Still, “businesses are so nervous that if anything goes ‘off script’, the job market impact is magnified,” Mark Zandi, economist at Moody’s Analytics, told The Fiscal Times on Friday. He said that “the first and most immediate priority is to raise the debt ceiling in a timely way. If that’s not done, all the other discussions about jobs are irrelevant because it would undermine confidence.”
Sen. Chuck Schumer, D-NY, said earlier this week – during a pointed jab at Republicans – that he “refused to believe there is nothing we can do to improve our jobs outlook.” He said the May jobs numbers (only 54,000 positions added for the month) were a “reminder that deficit reduction is important, but cuts alone will not fix what’s broken in the economy. We have 14 million hardworking Americans looking for jobs. We have to do something about both. The debt ceiling agreement should seek to include one or more proposals to give equal priority to jobs.”
Schumer told The Fiscal Times that “business leaders don’t want the economy to go down the drain.” In the next few months, he said, “the Senate will work on a highway bill, which is intended to put people back to work building infrastructure and making it easier to transport goods across state lines.” A jobs agenda might also include an extension of the employee payroll tax cut, he said. “We’ll look at reforming, simplifying, and making permanent the research and development tax credit, to help companies plan for the future.”
The Republican governor of Wisconsin, Scott Walker, however, told The Fiscal Times that the “federal government must get its fiscal house in order – that’s at the heart of [today’s] debate.” And he emphasized the importance of a flourishing jobs market. “We need to do more to emphasize job creation in the private sector. Long term, one of the big issues we hear about with small businesses and entrepreneurs is capital.” In Wisconsin, he said, “we’ll be doing more with venture capital and capital in general. We did a fair amount on litigation and regulatory reform, but we’re also looking at what other states like Texas have done on tort reform, to see if that would have an impact.”
Changing “the whole culture” of his state to create jobs is a critical issue for Governor John Hickenlooper of Colorado, a Democrat. “We need to [make] the state much more pro business,” he said. “So many people move here for quality of life issues. We want access to the outdoors; we want it clean and preserved. But we need stronger businesses to create wealth, so we can lift more people out of poverty.” He added that “what any business wants is some local predictability. We’re competing with the world, not just with other states. That demands a level of accountability, transparency, and speed.”
Toward those ends, Hickenlooper said that he’s working to “expand access to capital and to find ways to cut red tape. Time is money. I think government has to get to the point where we have a much greater sense of urgency. I don’t mind appropriate regulation – we all need regulation. But it shouldn’t have to take forever. In the public sector, there’s an inclination – and I say this with respect – towards making sure that we haven’t left anything out, that we’ve filled out a 30-page long form to make sure to cut every bit of risk for something that’s relatively harmless. And that is not,” he said with emphasis, “helping with jobs.”
Related Links:
The 10 Hottest Spots to Start a Small Business (The Fiscal Times)
Why the Job Situation Is Worse than It Seems (The Fiscal Times)
12 Creative Resumes That Worked (The Fiscal Times)
