By Jennifer S. Korn
Another month, another disappointing jobs report. The news out of the Bureau of Labor Statistics for July is discouraging for millions of Americans, including the more than 2.5 million Hispanics struggling to find work. Yet the reaction from our president doesn’t seem to match the magnitude of the problem.
From the White House, President Obama touted the 163,000 net jobs added in July, saying: “Those are our neighbors and family members finding work, and the security that comes with work.” He has also told us that the “private sector is doing fine” and that his policies are “working.” So, what are Americans to do and what are those in the Hispanic community to believe?
Believe the numbers:
- July is the 42nd month in a row with an unemployment rate above 8 percent.
- The Hispanic unemployment rate in July was 10.3 percent–well above the national average.
- For Hispanic youth between the ages of 16 and 19, the situation is even more depressing at a whopping 29.4 percent.
The Labor Department report, “The Latino Labor Force at a Glance,” from April 5 states that the unemployment rate averaged 11.5 percent among Latinos in 2011. A year later, the average is 10.6 percent–not much has changed since last year. These are troubling figures because as the Hispanic population grows, the unemployment rate grows along with it. The 23 million people of Hispanic or Latino ethnicity represent 15 percent of the U.S. labor force.
The most telling statistic: In December 2007, the unemployment rate for Latinos was 6.3 percent. Fast forward to 2012, and it is still stuck at an unacceptable rate of more than 10 percent.
As we consider these facts, it is easy to conclude that the White House’s optimism about our economic recovery is at best naïve and at worst pure political spin three months out of the presidential election.
The truth is that this president has the worst record of job creation in modern history; that 23 million Americans who remain unemployed have found no solace or security in this sluggish economy; that consumer confidence has declined to levels not seen since early January; and that, as a consequence, businesses are simply reluctant to hire.
If we remain on this path and do not avert the looming fiscal cliff, experts predict that the U.S. economy could lose anywhere from 2.8 million to 10 million jobs. Obama’s continued push to impose higher taxes and unnecessary regulations, especially on small businesses, is simply stifling job creation. Don’t take my word for it; believe the Tax Policy Center, a think tank often cited by the president.
One major obstacle is that Obama believes government is the primary driver for the creation of jobs, but the reality is that small businesses are the engine of job creation in our country.
Small businesses represent 86 percent of our $15 trillion economy. As pass-throughs, incomes of these small businesses are taxed at the top two individual tax rates. Under Obama’s plan, those two tax brackets will increase in 2013 to 36 percent and 39.6 percent respectively. That would have a crippling effect on already struggling small businesses across the country.
Latino-owned businesses have been the fastest-growing small businesses in the country, but those numbers are beginning to slow. At a Hispanic Leadership Network gathering in San Antonio of over 200 Hispanic small-business owners last month, their biggest concerns were how the president’s health care law will limit their ability to expand, overreaching regulations on bank lending, and fear over the president raising taxes on their businesses.
After years of hard work to build their business, if they are able to bring in $250,000 they do not consider themselves “rich.” That number is not their actual take-home pay–it goes back into the business, into paying employees, and upkeep on the business itself. Yet the president wants to tax them more. This is not an incentive to achieve the American Dream–it’s a deterrent.
Expert studies show that lowering the top tax rate to 28 percent increases the probability that a small business would hire by about 48 percent and the likelihood that they expand by nearly 40 percent. Those are the facts, whether the White House likes them or not.
By 2018, Hispanics are expected to make up 18 percent of the labor force. We need policies and solutions that will help this increase in the labor force find jobs or start their own companies–rather than just add to the unemployment rate.
Obama promised that his $831 billion stimulus package would keep unemployment below 8 percent, that he would cut the deficit in half by the end of his first term, and, in an interview, that if he did not fix the economy in three years, his presidency would be “a one-term proposition.”
Well, for the Hispanic community, we are still waiting for the president to follow through on his now broken promises. Lately, every time a jobs report comes out, you may hear a string of four-letter words across our community. After those choice words will be the same question: Where are the j-o-b-s?
Jennifer S. Korn is executive director of the Hispanic Leadership Network. Previously, she served in President George W. Bush’s White House as director of Hispanic and women’s affairs.