I’ve been hiring people for over 15 years. I’ve hired at least 500 different people during that time so I understand “how the economy works” as conservatives like to say blah blah blah. This chart from the FED of Philadelphia should fall in the “you don’t say? </sarcasm>” column since the answer to the question what restrains hiring is the OBVIOUS answer. You can find the FED survey HERE.
What you don’t see here is TAXES. Taxes would fall under the “other factors” category and is an after thought when businesses are hiring because companies can still have positive cash flow and show a “loss” on their taxes thus having no tax liability. Taxes only are part of the picture when we’re talking about profits.
Some like to claim that if businesses just made more money – then they would start hiring more people. I have two responses to that:
#1 – You don’t know what you’re talking about. Businesses aren’t interested in hiring more people for the sake of more people and they shouldn’t be. They hire enough people to substantiate the demand of those workers. Apple Inc. is sitting on $98 Billion in cash reserves and while the company is growing – they’re not growing at anything close to the rate that their profits are growing. They’re trying to manage an efficient labor budget paying good salaries to those who have a real impact on their creative side and paying Chinese slave wages to the worker bees at their FoxConn plant in China.
This happens time after time with companies – here’s a good example of increasing profits and decreasing payrolls HERE.
#2 – Apple is instructive in how corporations use their profits. Despite pushing for a tax holiday – Apple’s $98 billion cash hoard has become a topic of discussion for shareholders. So – under pressure from shareholders … and having more money than god Apple has decided to reinvest some of that money back into it’s employees through wage increases, bonuses and better benefits – right? Except – that’s not true at all. They’re not reinvesting that money into their employees at all. They’re giving it back to their shareholders and they’re certainly making sure that they’re C-suite executives are handsomely rewarded. But – the worker bees … no soup for you. You can read more about that HERE.
Like us on Facebook?