Subsidized Jobs Programs

Job subsidies also provide help to private sector, By Catherine Rampell, July 28, 2010, New York Times: “States are putting hundreds of thousands of people directly into jobs through programs reminiscent of the more ambitious work projects of the Great Depression. But the new efforts have a twist: While the wages are being paid by the government, most of the participants are working for private companies. The opportunity to simultaneously benefit struggling workers and small businesses has helped these job subsidies gain support from liberals and conservatives. Congress is now considering whether to extend the subsidy, which would expire in September, for an additional year. A House vote is expected on Thursday or Friday. Despite questions about whether the programs displace existing workers, many economists have argued that direct job creation programs are a more cost-effective way to put some of the nation’s 14.6 million unemployed back to work than indirect alternatives like tax credits and construction projects. The average duration of unemployment continues to break records, after all, and studies have shown that the longer people are out of work, the less employable they become…”