Anemic job growth has persisted in the weak recovery that began in late 2009. Recent weekly job claim numbers have climbed back to a level above 400,000 in the weekly reports.
Additionally, the Bureau of Labor Statistics now reports, “Through the 12 months ended in March of last year, 505,473 new businesses started up in the U.S., according to the latest data available from the Bureau of Labor Statistics. That’s the weakest growth since the bureau started tracking the data in the early 1990s. It’s down sharply from the record 667,341 new businesses added in the 12 months that ended in March 2006.“ 
The USA Today article goes on to point out that the rate of employment growth has been decreasing in recent months with companies having less than 50 employees adding only 27,000 and 84,000 jobs, respectively in May and April. This was down from the 100,000+ level achieved at the end of 2010. (Here)
Entrepreneurial talent and small businesses create jobs. They will add labor when they perceive that the new employee will generate on going revenue in excess of all costs associated with hiring and maintaining a new job position. Such a return on labor is necessary for the growth of any small enterprise.
No lack of cash exists to invest in additional employees. Businesses have massive amounts of cash, some $1.8+ Trillion. Yet entrepreneurial and small business decision makers have been reluctant to expend their capital to hire, fearing both the uncertainty surrounding customer demand/revenue as well as the lack of clarity regarding labor costs.
On the demand side consumers are face with tremendous uncertainty in job availability/security, as well as housing concerns and accelerating food/energy costs. Such concerns limit the consumers willingness to spend and the resulting revenue of businesses. Small business owners also face an unprecedented level of uncertainty over future operating costs posed by the potential tax changes/increases, medical care insurance changes, pending regulatory implementation and associated medical insurance costs of Obamacare, the availability and cost of future expansion external capital provided by the financial industry, and the cost and availability of energy.
Until Washington DC acts to reinvigorate consumer confidence, spending and revenue will languish. Until Wash DC removes regulatory constraints that exacerbate costs, small firms will continue to hunker down conserving cash and avoiding hiring. We are endlessly promised by those in Washington transparency, clarity and the removal of obstructionist regulation; now it’s time for those in Washington to deliver.
Tell ’em where you saw it. Http://www.victoriataft.com
