With unemployment continuing to hover around 7%, there’s lots of talk about the need to create more jobs. From the White House to industry board rooms to local coffee shops, people are in agreement about the need to create more jobs and get more U.S. workers back to work. But discussions bog down when they get to how to make it happen.
From government economists to the unhappy unemployed worker heading for yet another job fair, there are plenty of ideas about how to jump start job creation but little agreement on who is best suited to lead the charge and even less agreement on the probable impact of various job creation plans.
The Washington Post recently tried to make sense of the most promising plans and their pros and cons. Here’s their take on the situation:
- Many think small businesses are best suited to take the lead in job creation. The Small Business Administration argues that small businesses already employ 50% of the private sector work force and have account for the creation of two-thirds of net job creation over the past 15 years. The problem is that the SBA classifies small businesses as those with fewer than 500 employees which the Washington Post explains accounts for 99.7% of the U.S. companies that employ workers. A more realistic small business definition is those with no more than 50 employees. Using the smaller employee count, pares small businesses down to a third of U.S. companies which also decreases the potential impact small business owners could make on the overall job picture.Of course, numbers alone don’t tell the whole story. The recession and continuing economic woes have taken a greater toll on small businesses which have fewer resources available to weather hard times. Few small businesses are in a position to increase their commitment to the job market even though they might want to.
To be continued
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