What your audience needs to know about the $15 billion jobs bill

By Flickr user billjacobus1

You can hardly go amiss with an employment story these days, and never more so than in the coming week, with readers wondering about the import of the $15 billion jobs-creation bill passed by the Senate on Wednesday and a confluence of employment and income economic reports due out next week.

If passed by the House and signed by President Obama, the latest jobs bill would let businesses skip paying Social Security and Medicare payroll taxes this year if they hire unemployed job-seekers, plus provide other tax credits to employers.  The law is expected to boost hiring by 250,000 – a fraction of the nation’s 9.3 million unemployed, as reported earlier this month by the Bureau of Labor Statistics.

Obviously, it behooves biz writers to do the math on the incentives offered in the bill.  Employers’ share of the payroll tax is 6.2 percent of the new hire’s gross salary, and we’re already two months into 2010, which erodes the value of the credit.  I have to wonder if a savings of less than 6 percent of wages is really going to create incremental hiring, especially at small- and medium-sized firms in hard-hit industries such as manufacturing and transportation.

Will the prospect of saving perhaps $2,400 for a single year (plus a potential $1,000 extra credit if the worker still is employed at the end of 2010) really prompt companies to create more $40,000-a-year permanent positions?  Or will companies that planned to hire anyway merely reap an extra windfall at taxpayer expense?  As with other stimulus funds, it will be very difficult to measure the success of this program.  Aside from polling area businesses about their plans, you might want to speak to recruiters and placement firms and enlist their aid in determining whether hiring really picks up in coming weeks and months.  Your regional Federal Reserve Bank economists may also be good sources on jobs creation.

Your audience will be avid for news about the jobs bill, especially since unemployment benefits for many are set to run out as the extensions Congress passed in December expire at the end of the month.  Senate Majority Leader Harry Reid – forced to drop an unemployment-benefits provision from the jobs-creation bill – is pressing for a separate extension of as long as 10 months.  Meanwhile, though, your audience could be getting benefits-cancellation notices as early as next week if Congress doesn’t act. Jump on this milestone with online polls and surveys that will connect you with unemployed workers watching their last source of income run out.  It’s a sad but compelling source of powerful human interest and personal finance stories.

The law also provides money for transit projects and highway construction, in time for spring and summer road-building season.  These can be meaty jobs with good hourly wages.  Your state’s transportation department should already have a list of 2010 road projects, contractors and any outstanding bids.  With their help, determine what the total employment on seasonal road projects is projected to be and whether the funding provided in the jobs bill will boost that at all.

And do your audience a favor: Don’t just reiterate the overall jobs number, but decipher it into actual positions and wages.  What’s the ratio of $15-an-hour traffic-control spots to paving jobs?  Are engineers and clerical workers counted on the construction rolls?  Are the jobs really open to the public, or are there rosters of laid-off workers waiting to fill any newly created positions?

Road construction is such a high-visibility sector that you might want to plan long-term for several business features over the season.  What goes into the cost of a mile of highway, for example?  Break it down into hours, wages, equipment costs, materials, etc., so taxpayers can see how this boosted funding ripples throughout the economy.

Don’t overlook state infrastructure programs aimed at jobs creation, either, and those funded by other stimulus pools.

Planning ahead:  Next week offers a plethora of jobs-related data to support any employment packages you’ll be doing, including:

• March 1:

Bureau of Economic Analysis personal income and spending

Construction spending

• March 2:

Automakers release car, truck sales

• March 3:

Challenger, Gray & Christmas job-cuts report

ADP (payroll) employment report

• March 4:

Initial jobless claims (weekly)

Department of Labor worker productivity

• Mar. 5:

Bureau of Labor Statistics employment situation (unemployment rate)

Federal Reserve consumer-credit report