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Meizhu Lui

Meizhu Lui

Posted: December 7, 2009 12:55 PM

White House Jobs Summit: Digging Out of Unemployment Cycles

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The way we measure our national economy - by GDP, or the total amount of spending on goods and services - is a lousy way to measure success. When GDP rises, that's not necessarily a good sign. In the run-up to the meltdown, the rising GDP should not have been taken as a reason to party-on; GDP didn't show that consumers were spending big bucks they didn't have. And now, when those same pundits see an uptick in GDP numbers, it leads to them to such oxymorons as "jobless recovery."

We know the numbers: unemployment passed the double digit mark of 10%. That number, broken down by race, shows African Americans with 15% unemployment, Latinos at 12%, Asians, although suffering less unemployment, are seeing the fastest growing rate of unemployment, and for some Native American tribes, close to half have no jobs. For whites, the double digit mark has not quite been reached at 9%. And so while all racial groups are feeling the pain, communities of color are in economically critical condition.

What needs to be done in terms of job creation, the subject of the White House Jobs Summit this week? Ideas coming from a network of experts of color on ways to get all Americans on the path to economic mobility and security organized by the Insight Center for Community Economic Development would end unemployment as we know it, including closing the racial employment gap.

  • First, like in the emergency room, those with the most life threatening situations need to be cared for first. Every life can be saved if you start with the ones with the most pressing problem. There are new emerging sectors whose growth will be encouraged by government investment: besides green technology, broadband and transit are two sectors that will need new workers. Due to structures and prejudices that continue to make people of color last hired and first fired, the first hired for new jobs need to be those from communities with disproportionately high unemployment rates. How? Tax incentives for employers who hire people from disproportionately affected groups; job training and creation programs that are targeted to people/areas disproportionately affected by job loss; community rebuilding programs with job residency requirements.
  • Second, the government must encourage and enable microenterprise development. Self-employment and microenterprise (businesses that employ less than five people) is an undervalued and undercounted job creation strategy. There are nearly 25 million microenterprises, which fill unique niches, often in ethnic markets, and there's room for more, if the process were made easier. How? Removing barriers to the use of Department of Labor funds for microenterprise development; counting the the self-employed as "employees" for the purpose of qualifying for Workforce Investment Act dollars that could help them gain the skills to become more successful entrepreneurs; increasing access to finance for micro and small business loans by having the government serve as a loan guarantor or putting more money into CDFI's to administer small business loans; simplifying tax filing for the self-employed; a self-employment tax credit to incent low-income low-wealth entrepreneurship.
  • Third, identifying critical sectors and training unemployed workers for specific jobs is a win-win. Through partnerships of major employers, community colleges, community based organizations, and government, sector initiatives have been successful in bringing hard to employ people such as the formerly incarcerated into jobs with advancement opportunities. People in these programs become valued long-term employees, to the benefit of the business, the employees, and the communities they live in. How? Many states currently have sector initiatives, but federal funding could be increased; of particular importance are the community based organizations that provide the personalized and culturally competent support that make these programs successful.
  • Last but not least, there could be guaranteed employment for all. Turning hard work into prosperity is the essence of the American dream - so let's give people the right to work with the federal government as the employer of last resort. How? In times of business downturns, the federal government working through local institutions would expand direct employment for projects that strengthen human and physical infrastructures. When private employment expands, these programs would contract. For the first time in US history, the American people would not be subject to the whims of the marketplace; they would have the peace of mind that comes with economic security. Will that cost too much? This would not be a bail-out or a hand-out. And it would give save our nation from perpetual cycles of crisis and recession.

We can get the economy to work and work for all of us, by putting the American people to work. We're shovel ready!

 

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