The right’s jobs debacle: Here’s how to bring unemployment down to zero

[unhappycamper]

http://www.salon.com/2014/09/01/the_rights_jobs_debacle_heres_how_to_bring_unemployment_down_to_zero/

Forget Paul Ryan's delinquent fathers theory. Want to crush poverty? Here's how the government can end joblessness

The right’s jobs debacle: Here’s how to bring unemployment down to zero
Bryan Williams
Monday, Sep 1, 2014 01:30 PM EST

As America celebrates yet another Labor Day, it’s hard not to dwell on the fact that many in the country are still looking for work. According to April figures from the Bureau of Labor Statistics, 9.8 million people actively looking were unable to find employment. Creating jobs for them might be the easiest possible way to help the millions of impoverished job seekers out of poverty.

~snip~

Once we start investigating the numbers, it’s surprising how doable guaranteeing jobs looks. If there are 9.8 million unemployed people, giving each of them a $30,000-a-year full-time job (approximately $15 per hour) would cost about $294 billion. On the one hand, that’s a lot of money. It’s approximately equal to the $265 billion the federal government spent on Medicaid last year, and it’s about half the $585 billion spent on Medicare. These are large federal programs, and squeezing an extra program of their magnitude onto the federal books would not be that easy. On the other hand, the federal government took in almost 10 times that amount in total revenue. It’s only about 1.8 percent of total GDP.

These are imprecise estimates for a number of reasons. First, jobs cost money, since we have to provide inputs to workers before they begin. More important, we don’t have a good measure of how many people would sign up for a guaranteed job, since there are many who are marginally attached to the labor force and thus fall through the BLS’s measures. These people might come back to the labor force were a job guarantee in place. Even then, a large jobs program doesn’t have to be all-encompassing. We could deliberately create a $50- or $100-billion jobs program to bring down unemployment to healthier levels. The same analysis applies, just with lesser magnitudes.

A jobs guarantee would save a lot of money, through reduced utilization of other social benefits programs. Since existing programs exclude many of the poor and unemployed, though, calculating how much we’d save is tricky. About 2.6 million people receive unemployment benefits, less than one-third of the total unemployed. Of the unemployed, about one-third are long-term unemployed, meaning they’re likely ineligible for unemployment benefits. A good guess might be that 1.8 million of the unemployed in the Labor Department’s number are eligible. Since the average unemployment benefit is around $300 per week, giving these people a guaranteed job would save about $28 billion a year.