Good News on the Job Front is a Nice Start . . . But Not Enough
Dec. 8, 2009
Isaac Cohen for HispanicBusiness.com
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Good news about job losses, decreasing only 11,000 in November, brightened the U.S. economic outlook. It was about time. The destruction of jobs caused by the Great Recession may have peaked, given the declining trend, in unemployment. During this year´s first quarter, monthly job losses reached 645,000; they subsequently decreased to 357,000 in the second quarter and to 188,000 in the third quarter.
The active intervention by the government has worked by avoiding a deeper fall, equivalent to a depression. The nonpartisan Congressional Budget Office estimated that the Economic Recovery Act, approved in February, contributed between 1.2 and 3.2 percent to economic growth in the third quarter and generated between 600,000 and 1.2 million jobs.
However, a declining trend is no reason to be complacent, because in November more than 15 million persons remained unemployed. As President Barack Oabama declared, "good trends don't pay the rent. We've got to actually grow jobs." To stimulate job creation, specific legislation is under consideration, by the House of Representatives and the White House.
Among the proposals under consideration are to use some of the funds paid back by the rescued banks, tax incentives for home owners who make their homes more energy efficient and to restore the flow of credit and tax incentives for hiring by small businesses.
However, given the increased fiscal deficit, there are constraints to the amount of resources that can be dedicated to job creation.
Isaac Cohen is Former Director, Washington Office of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC). He also serves as a commentator on economic and financial issues for CNN en Espanol TV and radio.
Source: HispanicBusiness.com (c) 2009. All rights reserved.
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