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On a local level, which is what I'm involved in, by letting contracts. We've done a couple major projects in the last year or so which encompassed some deferred maintenance, sewer work and building demolition and construction. I don't know if the projects created any jobs but I did have a couple of the winning bidders tell me that winning the contract meant they didn't have to lay off employees. The companies and employees are local operations so these are our friends and neighbors. Only one project was with stimulus money and even that was convoluted and came through the MD Board of Public Works.
Another way is granting concessions, such as tax breaks for an expansion, which will have a company hire more workers. That one is dicier and the government needs to have an air tight agreement for it that makes room for suspending or revoking the concessions if the business doesn't hire or do whatever it was to qualify for the breaks.
The long answer is that they don't create long term stability but yes they can create jobs-artificially.
For example, the government can build a road where there previously existed no road, this may give a job to whichever construction firm was hired to build the road. (this is more like saving a job than creating one). To create jobs the gov't must under take in general larger projects. For example, say a constrcution company has 5 employees who in an economic downturn are only working 30 hours a week. For the government to actually CREATE a job for them they must make more work than those 5 constrcution workers can handle (or 50-60 hours of work a week lets say). That is the point a new person would be hired and jobs get created.
However most economist find that if you have to spend $1 million just to fill up work for those five workers, just to create 1-2 new jobs, you would often be better off just giving those 1-2 people 50-100k a year. In the case of the New NY stadium I think they said they made new jobs at a rate of 1/2 million dollars per job.
not to mention when the government has to spend millions just to make a few more jobs, they have to first confiscate those millions of dollars away from other people to make those new jobs. so in other words, they take millions away from someone who is already making jobs and give it to someone who is on the border of laying off people.
As you can see spending $1million just to make 1-2 new jobs is highly ineffective and thats why obama and the stimulus plans are not doing so great.
Believe me, if the government could easily create jobs, then all the gov't in the world would come together and figure out how to make jobs and there would be no unemployment. Usa, europe, canada all have near 10% unemployment and the rest of the world worst.
However most economist find that if you have to spend $1 million just to fill up work for those five workers, just to create 1-2 new jobs, you would often be better off just giving those 1-2 people 50-100k a year. In the case of the New NY stadium I think they said they made new jobs at a rate of 1/2 million dollars per job.
It costs over $100K to maintain the average already existing job for a year. Creating a new job will obviously cost more. The problem with just giving people cash is that you get nothing back in the way of output. Very few economists see that as a viable approach, except in the case of people to whom you are already giving cash, such as food stamp recipients or those on unemployment. Otherwise, you would rather spend more per person in exchange for the output that a job will produce.
Quote:
Originally Posted by nottigurl
not to mention when the government has to spend millions just to make a few more jobs, they have to first confiscate those millions of dollars away from other people to make those new jobs.
Sometimes they do, sometimes they don't. Not one dollar of offset to the stimulus bill expenditures has been collected from anyone for instance. It's all deficit outlay financed by a sale of securities to those here and abroad who were holding dollars that they wished to invest.
Quote:
Originally Posted by nottigurl
As you can see spending $1million just to make 1-2 new jobs is highly ineffective and thats why obama and the stimulus plans are not doing so great.
The stimulus bill is almost exactly on the track that was projected for it. Through the end of the third quarter of 2009, there were just over a million jobs in the economy that would not have been there without the stimulus. By the end of the fourth quarter, the number had risen to about 1.8 million. Various public and private sector entities are doing the estimates of those jobs saved or created. They are all in the same general ballpark.
It expands the size of government bureaucracy and then hires employees. Government jobs and those requiring independent contractors for the government are the only jobs government "creates". A significant number of these jobs are not permanent positions and only extend through the life of the particular project that is funded. A perfect example is the census.
Was this intentionally snide and condescending, or accidental? Honest question.
Well it certainly wasn't snide, but it was condescending, was it intentional? Perhaps. However, based upon how such threads tend to go, it was intended to be answer in anticipation of waiting for the other shoe to drop, so to speak.
The government creates jobs by lowering barriers to production. Lower taxes, low crime, and less government regulation increases investment in businesses (from around the world). The more investment there is, the more workers are hired. The more workers are hired, the more value that's created (widgets, etc). The more value that's created, the more the workers are paid (and buy).
Hence, less government creates more productive workers.
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