Tax Credit for Adding Staff — The Answer to Job Creation?

Looks like there’s been talk again in the last couple of weeks to implement a strategy used by the Carter administration in the late 1970’s — offer employers a tax credit for each full-time hire they make! Evidently there’s more than one proposal which are getting bipartisan support in Congress. Probably due to the fact that unemployment is averaging 9.8% and experts expect it to continue to stay at a high rate, even rise for most of 2010!

Of course there are critics arguing against the tax credit… and it seems to me they bring up some good points to consider! They claim that the size of the credit would be much higher today to reach the same desired effect –primarily due to inflation, and that means more than the $3,000 in Obama’s proposed tax credit. Others say that in the 70’s, the recession was ending and hiring was going to be done ayway; whereas today, employment is still heading downward. Another point made is that an emloyer would be better off hiring a temporary worker (thus saving on paying benefits) for a couple of years.

I wonder though, would you want to work in one of these newly created positions? I would think most workers would be worried that once the tax credit expires, so does their position and then it is back to the unemployment lines.

Anyway, I’ve attached a couple of articles on this subject if you’d like to read for yourself!

HR Exec..pdf

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