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Unpacking The Jobs Plan

September 14, 2011

— Joe Light

In Thursday’s much-anticipated jobs speech, President Barack Obama called for new infrastructure programs, payroll tax credits, and decreased government regulation to create new jobs, as well as extended benefits for the unemployed.

Here’s a look at how the jobs plan, if enacted, would directly affect different groups of workers as well as the unemployed:

The Unemployed

Under Mr. Obama’s plan, the unemployed would see several additional programs to help get them back to work.

The plan would renew the 99-week unemployment benefit limit, which would expire at the end of this year if not for Congressional approval.

States would be required to start what White House officials call “rigorous reemployment services” to help the long-term unemployed–those looking for work for 27 weeks or longer–find jobs. Modeled on current jobs programs offered in Georgia and North Carolina, employers could potentially “try out” and train unemployed workers for free while the workers are paid by unemployment insurance funds. Some economists have noted that the success of such programs hasn’t been proven by research, and labor advocates have expressed concern that it could lead companies to exploit desperate job-seekers.

Meanwhile, employers would get a tax credit of up to $4,000 to hire people who have been out of work for more than six months, a move that would help level the playing field for the long-term jobless, said Rutgers economist Bill Rodgers.

“The reality for these workers is that they have a weaker job network and skills that are beginning to atrophy,” Mr. Rodgers said. “[The credit] helps offset that perceived cost for employers.”

The actual impact that the president’s plan would have on the unemployment rate will depend largely on how confident Americans and companies are in its effectiveness, Mr. Rodgers said.


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