The Dow Jones Industrial Average has flirted with 10,000 points. U.S. manufacturing, exports and home sales are showing signs of life. The economy is growing again, but it’s failing by one critical measure: jobs. It’s being billed as the jobless recovery, and it isn’t sparing Minnesota workers. According to the most recent data from the Minnesota Department of Employment and Economic Development, there are 240,000 unemployed workers competing for 31,000 unfilled jobs statewide.
That’s nearly eight job seekers for every job opening, a ratio that has spiked from 2-to-1 just two years ago. Since then, job seekers have risen by 83 percent, and job openings have fallen by 50 percent.
“We’ve lost a lot of jobs all across the spectrum,” said Kris Jacobs, director of the JOBS NOW Coalition, a Minnesota organization that does research and advocacy work for the creation of family-supporting jobs. “It’s really tearing families up. It’s just wreaking havoc on our community.”
It’s hard to know where, exactly, to point the finger for Minnesota’s wide statistical gap between job seekers and job openings. But it’s important, Jacobs said, that workers not blame themselves for being out of work.
“That’s hard, of course, because you think there’s always something you could’ve done when you go to bed at night, and then you feel bad about yourself,” she said. “But no amount of motivation is going to get you on the happy path with that kind of jobs gap.”
What’s the answer?
Rather than waiting out a jobless economic recovery, the JOBS NOW Coalition is pushing two proactive approaches to narrowing the jobs gap, including one modeled 15 years ago in Minnesota.
• A wage subsidy. Jacobs wants to see the state revive the Minnesota Emergency Employment Development program, or MEED. Developed during the farm crisis of the 1980s, MEED provided state subsidies to employers for hiring unemployed workers who had run out of unemployment benefits.
Jacobs said MEED put 42,000 Minnesotans to work, mostly in private-sector jobs. The cost of the program to taxpayers: roughly $3,000 per job.
“Businesses need some cash to hire people,” Jacobs said, “and the workforce needs some kind of incentive to offer employers to hire them as quickly as possible. It’s a simple, effective program.”
• A job tax credit. Economists at the Center for Economic Policy and Research have advanced the idea of compensating employers for shortening the amount of time employees work – as long as they keep workers’ compensation levels unchanged.
The theory calls for employers to shorten their employees’ workweek by a given amount – say 5 percent – and for the government to compensate employers via a tax credit so that they can continue to keep workers’ income unchanged. If workers are putting in 5 percent fewer hours, economists say, then they should want to hire approximately 5 percent more workers, spurring job creation.
Forum on the crisis
On Nov. 12, JOBS NOW will co-sponsor “The Jobless Pandemic; Prescription for a Cure,” a public forum on wage subsidies, job tax credits and other vehicles for stimulating job growth.
The featured speaker is Tim Bartik, an expert in job creation for low-income, low-skill workers. Bartik, Jacobs says, is working with members of Congress and the Obama administration a new job tax credit, and he has written favorably about MEED as an effective strategy to combat the jobs gap.
“He’s going to talk about what the research shows and throw it out for an audience of unemployed people, low-income (workers), hopefully some politicians and a responder panel,” Jacobs said.
The Nov. 12 forum will run from 4 to 6:30 p.m. at the Zuhrah Shrine Event Center, 2540 Park Ave. S., Minneapolis.
“We need some solutions,” Jacobs said. “Hopefully, this is a start.”
Michael Moore edits The Union Advocate, the official publication of the St. Paul Regional Labor Federation.
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