When President Obama took office in January of 2009, the U.S. was in the midst of a recession. The business climate was tepid, banks were not lending and firms were laying off thousands of workers each month. The economy has sputtered since then and the labor market remains historically weak, prompting the Obama Administration to propose a comprehensive job creation bill aimed at helping the nation's unemployed secure work
The president unveiled his job creation bill during a joint session of Congress earlier in the month. Though public officials' attention this past summer was largely focused on the U.S. budget deficit and soaring debt load, elected leaders have shifted their attention to the beleaguered job market, which is suffering through a period of historically high unemployment.
The U.S. Bureau of Labor Statistics affirmed job growth was flat in August, with companies laying off the same number of workers as they hired. Some experts said the 45,000 Verizon workers who went on strike during the month prompted the weak labor figures, obfuscating data collection methods.
Still, labor growth has slowed from levels attained during the first four months of the year, worrying U.S. officials, economists and the more than 14 million unemployed Americans. Public officials are largely divided in their views of how to stimulate job growth
, and Republican presidential candidates have put forth their own job creation plans offering a markedly different approach to job policy than Obama's.
The president's plan is effectively a $450 billion stimulus package, analysts assert. Roughly $250 billion in the proposed plan is directed toward the extension of employer and payroll tax cuts, which Obama and his senior advisers contend would prompt businesses to hire additional workers.
What's more, the plan included another $200 billion that would be used to create construction jobs
through infrastructure projects, save teachers from potential layoffs and stimulate additional hiring in sectors hit hardest by the recession. The bill could also potentially create customer service jobs
, some analysts say, as it would incentivize companies to keep business operations within the U.S.
Bloomberg recently conducted a survey of economists, asking them whether President Obama's proposed job creation plan would help to ward off a double-dip recession. Economists from some of the nation's biggest financial institutions and most influential public policy organizations were included in the poll, according to a report from the news provider.
Overall, economists said if passed, the $447 billion jobs plan would likely prevent the recurrence of a recession. They further asserted it would help to maintain positive GDP growth next year and push down the unemployment rate, which currently sits at 9.1 percent.
The job plan could help increase GPD growth by 0.6 percent in 2012, and further spur the hiring of 275,000 workers, according to the median estimates of the 34 economists Bloomberg surveyed. Moreover, the unemployment rate could fall
by 0.2 percent in 2012 as a result of the legislation's being passed, according to the economists' median estimate.
While they projected it would help to drive economic growth, the economists' figures are sharply lower than those championed by U.S. Treasury Secretary Timothy Geithner. Geithner, who has come under criticism during his tenure, has said the proposed legislation could lend a significant life to the nation's GPD, potentially driving it 1.5 percent higher. Economists said such an assertion was ill founded, given the plan's relatively limited scope.
Nonetheless, without some sort of stimulus measure, economists fear the U.S. economy could be on the brink of a recession, which would further hurt the labor market and could drive up the unemployment rate.