Today’s Bureau of Labor Statistics (BLS) December Jobs Report is welcome news and a hopeful start to 2012. The BLS found that 200,000 jobs were added in December, with the unemployment rate falling to 8.5 percent. But while the jobs numbers represent meaningful improvement, more work must be done in 2012 in order to accelerate economic growth and job creation. Twenty-four million Americans remain either out of work or under-employed. Barring any unforeseen structural changes in the American work force, at last month's pace, it would take another two and a half years of similar monthly growth to merely replace the jobs lost since the downturn began.
The private sector has demonstrated that, in spite of Washington’s general dysfunction, American businesses are resilient and dynamic and can create jobs. Policymakers in Washington must focus their attention on ways to help the business community accelerate hiring and aid in their business growth.
It has often been said that small businesses – defined as those with fewer than 500 employees – account for about 70 percent of net new job creation. According to the December 2011 ADP National Employment Report, businesses with fewer than 500 employees were the chief driver of the strong numbers, accounting for 288,000 of the new jobs, while the service-producing sector increased employment by 273,000 jobs.
This Fall the Financial Services Forum and the Small Business and Entrepreneur Council released the results of a nationwide survey of 842 entrepreneurs and small business leaders that found that business leaders are pessimistic about the economy and economic recovery in general. The survey results found that 34 percent of respondents cited the weak economy as the most significant impediment to hiring new workers, while 15 percent cited access to capital difficulties, and 13 percent cited the cost of hiring new workers.
As our economic recovery continues, small and, especially, new businesses are vital to job creation. Several bipartisan bills pending in the House and Senate will improve access to capital and ease regulatory burdens on new and small businesses so they can grow and create jobs. The Forum has supported such pending legislation in the House and Senate. Forum letters of support for H.R. 2930, H.R. 2940, H.R. 2167, H.R. 1965, and H.R. 3213, which are moving through the House, were sent to House Committee leadership. Additionally, Senate letters of support were sent to Senate Banking Committee leadership on S.1831, S.1791, and S.1824.
The financial services industry also takes seriously the concerns regarding access to capital for new and small businesses. Many financial institutions are reviewing their lending policies or have already initiated specific programs, like second-look procedures, to ensure that sound businesses are getting the capital and credit they need to grow and create jobs.
This week the White House also released a new program, Summer Jobs+, which targets America’s youth and calls on businesses, non-profits, and government to work together to provide pathways to employment for low-income and disconnected youth during the summer of 2012. Several Forum members including Bank of America, Wells Fargo, JP Morgan Chase, and State Street Corporation have already pledged thousands of summer internships for this program.
Americans continue to struggle to make ends meet and American businesses face heightened competition from foreign firms. America’s priority must be to create new jobs, and American businesses must be able to be better equipped to do so. The Forum hopes that Congress and the Administration can work together on initiatives that promote innovation and enhance the conditions for our job creators and job seekers. America should lead by example and demonstrate to the world that we can address difficult political problems like the deficit and the tax code so that we can display American exceptionalism and revive the labor markets in America.
The Financial Services Forum is a non-partisan financial and economic policy organization comprising the CEOs of 19 of the largest and most diversified financial services institutions doing business in the United States.
The purpose of the Forum is to pursue policies that encourage savings and investment, promote an open and competitive global marketplace, and ensure the opportunity of people everywhere to participate fully and productively in the 21st-century global economy.
Welcome to ForumBlog. This is where our policy team analyzes the latest proposals, ideas, and news surrounding financial sector regulatory reform, trade, and the economy. Our goal is to provide thoughtful insights on the issues impacting the intersection of Wall Street and Washington, as we pursue policies that encourage savings and investment, promote an open and competitive global marketplace, and ensure the opportunity of people everywhere to participate fully and productively in the 21st-century global economy.