Unemployment Is 9.8 %, How Can Jobs Be Created?
Economy | October 9, 2009 at 2:11 amIt looks like technically the recession is over but with 9.8 % of the population jobless in September, can you say that there will be any speedy recovery? Chairman Federal Reserve Ben Berneanke says that the recession recovery cannot be expected to create a lot of jobs in near future. I like this honest opinion because it does not give you false hopes about seeing greener pastures soon. What looks gloomy is that the rate of unemployment was 9.7 % in August and in a span of 1 month it has shot up to 9.8 % according to a Labor Department report. This is the same period in which we seem to be expecting national economic improvement.
Though our logic might say that a bettered economy should create more employment, the fact may be that employers are first trying to rebuild their finances before making any attempts to hire new employees which will add to their costs. Also during the recession they might have noticed that they are able to manage well without extra human resources and they don’t want to hire people at present. According to Economic Policy Institute economist, Heidi Sheirholz , every month about half million people need to be employed till 2011. Now that’s a big figure so how should the government achieve this?
At least for the next one year it doesn’t look as though hiring can be done on a full blown basis. What do you think is going to create those much awaited vacancies?
A Fresh Money Stimulus Program from Government
The government has already come up with a lot of programs to stimulate the circulation of money in the economy. The February stimulus of $ 787 was enough to control further deterioration of the economy, but was not enough to create job vacancies. Well, one thing that the government can do now is to extend the unemployment monetary perks and the COBRA subsidies so that the unemployed have a way to sustain themselves. Also, the unemployed, who are having difficulty in purchasing things for their livelihood, will immediately spend money to buy their required commodities and this will again put the cash back in circulation. When manufacturing companies and retailers get back their investments they’ll not fire more people immediately. This will prevent further job slashes. 
Likely Industries for Hiring
According to Sophia Koropeckyj, director of Moody’s Economy.com industries that are engaged in improving the national infrastructure, school weatherization, building retrofication, and medical records implementation are the ones where a lot of hiring activity will take place; but the government can spend on these industries only in the coming year. So hiring does not seem to be significant till then.
Improving Manufacture
As the dollar seems to be falling in value in recent times, you can get to see that manufacturing has come down to an all time low. With the increase in domestic demand and export, the manufacturing sector might see revival in which case you can expect jobs to be created in this area.
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