A fine patriotic gesture just in time for Veterans Day. And perhaps they’ll help some veterans get hired.
Those who’ve recently returned from fighting our wars have had a hard time. The unemployment rate for them is now 12.1% — higher than the overall rate. Also higher than a year ago, though the overall rate has fallen.
The credits, however, aren’t for new veterans only. And veterans as a whole have a lower unemployment rate than working-age people who were never in the military.
Still, it seems reasonable to help those who chose to put themselves in danger — even for our dubious ventures in the Gulf. They’ve come home to a very bad job market and face some unique re-entry challenges.
Certainly reasonable to offer a premium tax credit to employers who hire long-term unemployed veterans with a service-related disability.
But, as The Atlantic‘s Daniel Indiviglio says, the hiring credits will hardly boost hiring in general. At most, they “may create a few jobs on the margins.”
I rather doubt it so far as long-term jobs are concerned. The credits aren’t nearly large enough to induce any company to hire a worker it doesn’t need.
They may, however, get more veterans hired for jobs that would otherwise have gone to non-vets. How many is questionable.
We’ve had hiring credits for disadvantaged workers since 1996. A new paper by Elizabeth Lower-Basch at CLASP convincingly argues that they’ve mainly created “windfalls” for large companies in low-wage, high-turnover industries, e.g., fast food chains, temporary help agencies.
No evidence employers hired anyone they wouldn’t have hired anyway. Surely not many veterans covered by the new tax credit bill.
The program that Lower-Basch reviews — the Work Opportunity Tax Credit — already offers tax credits for hiring both those who have a service-related disability and those who’ve been unemployed for at least six months.
The Recovery Act temporarily expanded the WOTC to include those discharged within the last five years who’d been receiving unemployment benefits for at least a month.
Yet here we are with the unemployment rate the President and a bunch of Senators are deploring.
I don’t want to rain on the rally ’round the troops — or the unique display of bipartisanship. But the fact the credits are being billed as a jobs measure tees me off.
Not as much as the bill they’re attached to, however. It’s supposedly to help businesses create jobs too — remove uncertainties, burdens on small businesses, etc.
Will certainly remove some burdens, though not those publicly acknowledged. Because it repeals a law, not yet implemented, that Congress passed to keep many thousands of government contractors from continuing to evade their tax liabilities.
Cost of the repeal is estimated at $11 billion. You could make a down payment on some real job creation with that.