Small-Business Owners On Jobs Bill

  • Playlist
  • Download
  • Embed
    Embed <iframe src="http://www.npr.org/player/embed/124371526/124371508" width="100%" height="290" frameborder="0" scrolling="no">
  • Transcript

Two small-business owners discuss whether the tax incentives included in President Obama's jobs bill would be incentive enough to hire new workers. Andy Hann of Fountain Hills Door and Supply in Arizona says until the construction industry rebounds, he's not going to be able to hire any workers. Meanwhile, Simone Wilker of the printing shop AlphaGraphics in Paramus, N.J., says the incentives might just be the push she needs to take on another sales person.

MICHELE NORRIS, host:

After a House vote yesterday, businesses are a step closer to getting a tax break for hiring unemployed workers. The measure still needs final approval in the Senate. If it passes, businesses that hire unemployed workers will be exempt from the 6.2 percent social security payroll tax through December. They'll also get a $1000 credit for every new worker they keep on the job for a year. Many in Congress doubt the bill will do much to create jobs. One worry is that most of the money will go to businesses that would have been hiring anyway.

We though we'd reach out to a couple of small business owners to find out what they were thinking. And first we're going to Andy Hann. He's general manager of Fountain Hills Door and Supply in Fountain Hills, Arizona - that's just outside Phoenix. He sells and installs doors and windows. Mr. Hann, welcome to the program.

Mr. ANDY HANN (General Manager, Fountain Hills Door and Supply): Hello, Michele.

NORRIS: I understand that you have 12 employees right now, if this bill passes, do you plan to hire any more?

Mr. HANN: No, we don't. At the current state, construction is at a standstill and our business is closely related to the construction industry. We have to see growth in the industry before we add any more bodies into our system.

NORRIS: Help us understand just how hard the housing market has been hit there in Phoenix.

Mr. HANN: Specifically, I can tell you that our revenue numbers are roughly a third of where they were two years ago. Construction in the Phoenix area has virtually come to a standstill. The amount of inventory that is still on the market needs to be dissipated. And most of the banks and financial institutions are hesitant or just are not loaning any money to developers to start any new housing programs.

NORRIS: Is there anything the federal government could do that would convince you to hire new employees?

Mr. HANN: Yeah, the key thing that the federal government can do to convince us to hire is to get the construction industry growing. In order for them to get the construction industry growing they have to really light the economy on fire. And they have to free up the financial institutions to be able to start loaning to people who want to start building houses.

NORRIS: Well Mr. Hann, all the best to you. Thank you very much for taking time to talk to us.

Mr. HANN: Certainly.

NORRIS: That's Andy Hann. He's the general manager of Fountain Hills Door and Supply in Arizona.

We go next to Simone Wilker in Paramus, New Jersey. She and husband own AlphaGraphics, a printing and marketing shop. Ms. Wilker, you have five employees, is that correct?

Ms. SIMONE WILKER: (Owner, AlphaGraphics) That's absolutely correct.

NORRIS: Are you planning on making any new hires?

Ms. WILKER: Well, I would love to be able to hire a new salesperson because I think it would be great to increase our sales and our revenues. So, that I definitely have in my mind.

NORRIS: I'll take that as a maybe.

Ms. WILKER: I guess it depends on the financial ramifications of hiring someone new at this point in time.

NORRIS: Now if you hired someone, you would potentially be exempt from the 6.2 percent social security payroll tax through the month of December - that make a difference at all to you?

Ms. WILKER: Oh, yeah, that would be nice. I mean every penny counts. That's the only way I can explain it. Every single penny counts. We're watching everything that we purchase. And we're watching our costs and paring everything down to the bone and that's why I'm really considering hiring someone new because if we could now increase our revenues and our sales, it would make a big difference to us.

NORRIS: Now as you know the debate here in Washington as to whether this bill would actually do enough to create jobs - you're the second small business owner we talked to, the first said he's not going to hire someone. You're saying well, I might do it but I'm not so sure. What would the government have to do to move you definitively and very quickly to yes, I'm going to hire someone?

Ms. WILKER: I guess it would be to increase the amount that they're willing to give you as an incentive. I mean I would love to see $5,000 or $10,000. And I would say that having someone on the rolls as an unemployed individual is costing the government a bundle at this point in time. And so anything that could help them in hiring new people and getting them off the unemployment rolls would be an incentive for the government to offer me more money. So in my dreams, they'd be offering the $5,000 or $10,000 to hire someone. But I don't think that realistic. So, I would say that a $1,000, plus not having to pay that social security tax for the month of December, would certainly help. And if I'm already looking to hire somebody, that might be the turning point whether I would hire them or not, and probably I would.

NORRIS: Well, good luck to you, thank you very much for taking time to talk to us.

Ms. WILKER: Thank you very much. I appreciate it.

NORRIS: That's Simone Wilker. She is the co-owner of AlphaGraphics in Paramus, New Jersey. Earlier we heard from Andy Hann of Fountain Hills Door and Supply in Arizona. We were talking to both of them about the tax break that businesses would receive for hiring unemployed workers should Congress pass President Obama's jobs bill.

Copyright © 2010 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.

NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR’s programming is the audio.

U.S. Unemployment Rate Holds At 9.7 Percent

Tan Ruihan (second from right) waited in a line to enter a job fair last month in New York. i

Tan Ruihan (second from right), who recently received a master's degree in finance from Boston University, waited in a line to enter a job fair last month in New York. Mark Lennihan/AP hide caption

itoggle caption Mark Lennihan/AP
Tan Ruihan (second from right) waited in a line to enter a job fair last month in New York.

Tan Ruihan (second from right), who recently received a master's degree in finance from Boston University, waited in a line to enter a job fair last month in New York.

Mark Lennihan/AP

U.S. unemployment held steady at 9.7 percent in February, the Labor Department reported Friday, and the economy shrugged off concerns that recent snowstorms would wreak havoc on the number of jobs lost.

The report said employers cut 36,000 jobs, fewer than the 50,000 that most analysts had expected — numbers that would have put the jobless rate at 9.8 percent.

The department also revised its estimate of job losses for January from 20,000 to 26,000.

Economists had expected the massive East Coast storms to inflate job losses by as much as 100,000, but the actual impact wasn't nearly as high, said Alan Levenson, chief economist at T. Rowe Price in Baltimore. The Labor Department said it wouldn't quantify the effect of the storms, which hit the same week that the government surveys businesses about their payrolls. Employees who couldn't make it to work and weren't paid aren't included on those payrolls.

"There were clearly a lot of people affected by the weather," Levenson told NPR. "The fact that the unemployment rate remained unchanged shows either much less of an impact from the snow or a slightly firmer underpinning of the labor market."

Excluding the storms, he said, the economy may have actually added jobs last month — marking only the second time that would have happened since the recession began in December 2007.

Brian Wesbury, chief economist at First Trust in Chicago, said forecasts of the snow's impact were based on historical data. But he noted that "when an economy is accelerating, I think the impact of the weather is smaller than if it's just cruising along."

The Labor Department said 5 million people worked fewer hours last month because of the snow. It also showed a drop in the average wor week to 33.8 hours from 33.9 the previous month, which Wesbury attributes to the weather.

Overall, he called the report "very, very positive."

Wesbury said a number of factors point to the possibility that the March employment figures that will be released next month could see a very large number of jobs added.

Far fewer census workers were added this month than many people expected, just 15,000, so next month should see a sharp increase. Hiring of temporary workers — usually a precursor to full-time employment — has steadily increased in recent months. And Wesbury said there also should be some bounceback from the weather.

"We seem to have turned the corner. The jobs data accelerate from here," he told NPR.

But there are still nearly 15 million people unemployed. About 40 percent of those have been out of work for more than half a year. If you add in those workers who have been compelled to work part time because they can't find full-time work or those who have quit looking, the unemployment rate actually rose to 16.8 percent, says Peter Morici, an economics professor at the University of Maryland.

"Jobs are a lagging indicator, not a never indicator," Morici said. "Eight months into the much touted recovery, the economy should be adding jobs, not losing jobs at a slower pace."

The House passed legislation Thursday giving companies that hire the jobless a temporary payroll tax break. But many economists doubt the measure will create a significant number of jobs.

Although the number of job losses was better than expected, "it's more than we should tolerate," President Obama said Friday.

The administration's top economist echoed that statement. "We need to achieve robust employment growth in order to recover from the terrible job losses that began over two years ago," said Christina Romer, head of the White House's Council of Economic Advisers. "That is why it is essential that Congress pass additional responsible measures to promote job creation. It is also vital that we continue to support those struggling with unemployment."

More than 6 million people are still classified as long-term unemployed — meaning they have been out of work for at least six months.

Brian Silverstein was laid off from his job as a mechanical engineer for a steel company more than a year ago. His entire department was eliminated, and none of his co-workers have been able to find work either.

"I've come to the conclusion that sending out resumes is probably pointless, because the number of resumes that I've sent out that were completely ignored is probably well over 90 percent," he told NPR.

Still, many recession-sensitive industries fared better in the jobs report than many economists had predicted. Construction lost 64,000 jobs, compared with an average of about 40,000 in the previous three months. But retail employment was flat and the leisure and hospitality industry gained 7,000 jobs, the first increase since September.

NPR's Tamara Keith and Yuki Noguchi contributed to this report, which includes material from The Associated Press

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.