Sunday, March 21, 2010

Will the new jobs bill drive hires in the industry?

Last week, President Obama signed an $18 billion jobs bill to spur hiring by giving tax breaks to small businesses. The bill also includes $20 billion for highway and transit programs.

The bill was passed March 17 on a bipartisan 68-29 vote, according to an AP report. The new measure would exempt businesses hiring unemployed from the 6.2 percent Social Security payroll tax through December and give employers an additional $1,000 credit if new workers stay on the job a full year. Taxpayers would reimburse Social Security for the lost revenue.

In addition to the hiring tax incentives and highway funding, the bill would extend a tax break for small businesses buying new equipment and modestly expand an initiative that helps state and local governments finance infrastructure projects, according to the AP report.

It remains to be seen if the bill will spike hiring in the construction sector. Construction employment continued to shrink in most American communities as 313 out of 337 metro areas lost construction jobs between January 2009 and January 2010, according to a new analysis of federal employment figures released March 18 by the Associated General Contractors of America, Arlington, Va.

Phoenix lost more construction jobs (27,600) than any other city in America, according to the AGC report. Steubenville, Ohio, and Weirton, W. Va., experienced the largest percentage decline in construction employment (44 percent, 1,600 jobs), followed by Grand Junction, Colo., (34 percent, 3,400 jobs); Las Vegas (32 percent, 24,500 jobs); Napa, Calif., (32 percent, 1,100 jobs); and Santa Cruz, Calif., (31 percent, 1,100 jobs.)

Eau Claire, Wis., added the most construction jobs (500) between January 2009 and January 2010, and experienced the largest percentage increase (23 percent) the report noted. Other cities adding construction jobs included Ithaca, N.Y., (9 percent, 100 jobs); Michigan City, Ind., (6 percent, 100 jobs); Waterbury, Conn., (5 percent, 100 jobs); and Grand Forks, N.D., and Minnesota (5 percent, 100 jobs).

The report stated that 230 metropolitan areas experienced double-digit percentage decreases in construction employment, while no city experienced a double-digit increase in construction employment. Meanwhile, 18 cities nationwide lost more than 10,000 construction jobs between January 2009 and 2010.

What’s your take on the new jobs bill? Is it going to encourage construction company owners to hire? How will it influence the glass and glazing industry?

—By Sahely Mukerji, Senior editor, Glass Magazine


Anonymous said...

Obama and the Democrat Stimulus Plan was to pay back the cost of the votes from the Unions, lobbies, and special interest groups. Republicans are guilty of adding pork to the waste. The fix for the financial crisis was, and is, to provide tax breaks to business to stimulate growing, hiring, and new business.

Anonymous said...

Has the president ever run a business or government office before being president? HELL NO! As a result we get a "Jobs Bill" that gives tax breaks for hiring someone when people are not buying anything. Business need customers before they hire new employees.

You spur growth buy giving people more of their own money, PERIOD!

Anonymous said...

The payroll tax cut that is the centerpiece of this bill is a targeted, reasonable way to get employers hiring again. This is a conservative approach to help put our economy back on track through tax relief, not more government spending.

Anonymous said...

We'll hire more people when we have more work, not because of tax credits that temporarily offset part of the new payroll costs. The incentive almost isn't worth it unless we are speaking of generating hundreds of new jobs, which means it might be of interest to very large companies. The public work programs will do more for jobs than this Social Security/ tax credit deal. Isn't SS in deep trouble anyway? Should we be witholding income from a vital program that's in the red already?