On March 18th, President Obama signed into law the “Hiring Incentives to Restore Employment” (HIRE) Act.
Essentially, this bill is a tax break for businesses:
1. If a company hires a worker who has been employed for at least 60 days, the company will not have to pay the 6.2% Social Security payroll tax during 2010.
2. If the new employee is retained for at least one year, the company will receive an additional $1,000 tax credit.
Theoretically, these tax breaks should encourage businesses to hire more workers.
The total cost of the bill is estimated to be $18 billion.
While the current focus of Congress is on healthcare, over 15 million Americans are still waiting for legislation regarding unemployment extensions and COBRA benefits. Hopefully, this should be on the horizon before the end of March.
As part of the jobless bill passed today (March 10th), the Senate voted to extend eligibility for unemployment benefits and COBRA through the end of 2010. Today’s Senate bill adds to the legislation passed on March 2nd, which extended eligibility through the end of March.
The House of Representatives still needs to vote on the new bill, which is expected to happen before the end of the month.
As a side note, if you haven’t yet visited Beyond.com, it’s worth a look. It is the world’s largest network of “career communities” and lets you search across thousands of sites to find the perfect job opportunity. Beyond is free to register and use.
Here’s what President Obama had to say about unemployment and jobs in his State of the Union speech:
Unemployment
- Bailing Out The Banks. He said that if the government had not gotten involved during the financial crisis, there is a chance that unemployment might be twice what it is today.
- Extensions. The President mentioned the unemployment extension. During the past year, unemployment insurance was “extended or increased” for more than 18 million Americans.
- 2 Million Jobs. Because of the Recovery Act, over 2 million people who otherwise would have been out of work still have their jobs. These include police officers, teachers, prison workers, and fire fighters.
Jobs
- New Jobs. The one specific area of jobs mentioned was clean energy jobs.
- Full Employment. “The only way to move to full employment is to lay a new foundation for long-term economic growth.”
- Financial Reform. By requiring banks to lend to small businesses, President Obama believes that these companies will be able to operate with enough financial stability to retain current employees, raise wages, and hire new workers.
- Encouraging Innovation. The area of focus here was again clean energy. New technology drives economic growth, and economic growth will lead to new jobs.
- Investing in People. President Obama referred to education. He proposed a $10,000 tax credit for four years of college, increasing Pell Grants, and forgiving loans on student debt.
