American Jobs Act Update – December 2, 2011
Last week, President Obama signed into law the Vow to Hire Heroes Act. This new law covers one of the many proposals put forth in the American Jobs Act.
American Jobs Act – background
Back in September, the President introduced the American Jobs Act, which had four primary areas of job creation:
- Construction: Projects to improve basic infrastructure, roads, and schools will help employ thousands of workers in construction related fields.
- Teachers: Aid to state and local governments will help keep teachers employed by using funds to prevent layoffs.
- Veterans: Businesses will be given tax credits for hiring returning veterans.
- Long-Term Unemployed: Employers will receive a $4,000 tax credit for hiring long-term unemployed workers. Note: They are defining “long-term” as six months or more.
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In addition, the American Jobs Act would allow for an extension of unemployment benefits through the end of 2012.
Over the last couple of months, the American Jobs Act has not received enough support on its own in order to be passed into law. Recently, specific components of the legislation, e.g. support for veterans, have been brought forth on an individual basis.
Vow to Hire Heroes Act
The legislislation enacted yesterday addressed the aspect of the American Jobs Act that addresses the 850,000 American veterans who are out of work. Specifically, it provides an incentive for businesses to hire veterans: A $2,400 tax credit for hiring veterans who have been out of work for four months, and a $5,600 tax credit for hiring veterans who have been out of work for six months or longer.
Of note, this bill received a unanimous vote of 422 to 0 in the House of Representatives.
While veterans represent fewer that 10% of Americans who are out of work, the passage of this bill may encourage Congress to consider further aspects of the American Jobs Act.