Businesses Tell Consumers It’s Your Fault We’re Not Hiring

It’s been termed “the new normal” and it looks like it is here to stay. Much of corporate America weathered the worst of the recession and currently sits on billions of dollars in cash. Profits are up, as is productivity. But don’t hold your breath for an uptick in hiring because, according to senior executives, there are no jobs.

As reported by The Washington Post, business is not interested in creating any new jobs until consumers start spending. And consumers aren’t interested in spending until they’ve shored up their savings and have evidence of job security. It’s a vicious cycle of pessimism that shows no signs in breaking.

Just as American households have learned to do more with less, so too have American businesses. Not only are they operating on the leanest employment force in recent history, when business is looking to invest capital it is looking at investments that encourage growth while simultaneously lowering the need for labor. Growth no longer means expanding capacity by building bigger operations or hiring more workers. Now it means finding means to serve existing customers more efficiently and transfer those methods to incoming business.

None of which is good news for the American public. Nor is it good news for Congressional Democrats.

Despite the large amounts of cash, soaring profits and lean, mean operations, the corporate class has found an easy target in the Obama administration. They are particularly unhappy with the fact that the administration is set to let Bush-era tax cuts expire and argue that the administration has created an atmosphere that his hostile to business and hostile to growth.

Hogwash.

When pressed for details no one in the Washington Post piece, nor any Congressional Republicans for that matter, can draw a positive correlation between tax cuts and job creation. And that’s because there isn’t any. Demand for products spurs growth and job creation. Demand is up but business has dug in its heels and will not add jobs until consumers return to spending rather than saving.

What we are seeing in the business world is the same kind of adolescent behavior we are seeing in the financial services world. Industry got very acclimated and comfortable being able to do what it pleased, consequences to the public be damned. Now that it’s time to undo some of that damage and learn to function in an economic model that is not completely predatory business would rather stop its feet and pout than participate. Banks have the ability to lend to struggling businesses just the same way that business has the ability to hire new workers and still operate at a profit. The only difference would be the spread of the margin.

I think it’s more than time to ask our private partners if this is good for our country, and ultimately, good for business. The private sector has had plenty of “carrots” in the first half of the Obama administration’s term. I’d say it’s time to give them some stick.

Read more: hiring, jobs, politics, tax cuts

photo courtesy of Tracy O via Flickr

Disclaimer: The views expressed above are solely those of the author and may not reflect those of
Care2, Inc., its employees or advertisers.

Caroline L.

4:27PM PDT on Sep 16, 2010

These big companies are in for a big shock over the long haul. Americans are not going to return to life as they knew it; they are disappointed, disillusioned and looking to "get out of the trap". They are saving and buying used; they are using less and sharing what they do have. A new type of community is growing among people who are tired of wearing a harnass, working like a dog, getting heaped with debt and then losing it all time and again to greedy bosses and wall street gamblers. They can take their plastic junk to China and India and see if you can get those people to give a shit about their crumby products.. not gonna happen.. they are busy trying to shove the products they make OVER THERE on us. But we are not buying anymore. We are headed to a leaner, cleaner and freer America. Enjoy the ride!

send a green star

A P.

12:10PM PDT on Aug 29, 2010

We must end Corporation = Person and Money = Speech. Look up end corporate personhood there are several groups working towards this end. We must also have Public Campaign Financing and outlaw political commercials (it's illegal in the U.K.) And we must reform corporate compensation. Those CEO's who bankrupt a nation and walk away with golden parachutes - this must end. And they need to be taxed on ALL their compensation like those of use who get a regular old paycheck do. And we need to raise the ceiling on FICA (Federal Insurance Contributions Act or Social Security) right now only first $106,800 of wages pay into Social Security. Which mean if you earn under that you pay on 100% of your wages. But when you earn millions and if those millions don't come in the form of a paycheck... This alone would go a long way to shoring up SS and bringing down the deficit.

We had gotten out of whack in our materialism and greed from top to bottom. We need to reprioritize. Maybe we need to rethink the 40hr workweek have more people employed working fewer hours. This would enable more time with family, for education, volunteering - you know having a LIFE. It would have to mean lower property values but what's important is affordability - where you own your property rather than your property owning you. We need a whole shift in values.

Monica K.

4:57PM PDT on Aug 28, 2010

It used to be that working Americans were the backbone of this country. It was in the best interests of business to keep us working - we were their customers. If you had a job, you paid taxes, the employer paid taxes and our government was strong. The economy was booming because working people spent money on the products that business produced. Now we have the "world market". Corporations pay lower wages to workers in emerging countries, thus increasing their profits, pay little or no taxes and have a huge world-wide potential customer base of people eager to buy their products. American consumers are no longer important and American workers are even less so. The "world economy" rather than bringing the rest of the world up to our standard of living is going to bring us down to theirs. It's a long-held dream of the power brokers - one world - with corporations in control, a wealthy powerful elite class and the rest of us just worker ants so busy scrambling for survival that we don't have time for concepts such as independent thought, individual rights, freedom and equality. If you think that sounds like something out of a sci-fi novel, you'd better wake up and take a look around you.

Mark M.

12:55PM PDT on Aug 28, 2010

People have the bad habit of saddling the president with all the blame. He is a big part of the picture, but not the ONLY big part. He cannot COMMAND corporations to hire. He cannot single-handedly set fiscal or monetary policy. He cannot DICTATE bank loan and corporate investment strategies. Nor should he have to absorb all the punishment for messes that were at least five years in creation. Bush did brashly slash taxes for the affluent, with far more than a suggestion that the money would flow into job creation, consumer demand and economic growth. None of that happened, his arrogance was unwarranted. Now the Republican'ts want an encore?! PLEASE! It's a classic case of economic policy driven by ideology and not common sense or an objective view of the data. Besides, they hide their true agenda in sustaining the tax cuts for the wealthy: it frees up more money to flow into their campaign coffers, which assures election of re-election for at least some be they well qualified or not. I wouldn't give a hoot in hell for some of the purported "policies" of these know-it-all baboons. And if anyone thinks the president doesn't need a vacation, consider he is on call 24/7/365, and if you think you know pressure, perhaps project yourself into that position and you will realize that on "vacation" he does all of us a favor by clearing some of his mind for that next, inevitable emergency. And for having to listen to idiot Republicant Beck-heads rant about his birth nation.

Nancy D.

8:11AM PDT on Aug 28, 2010

Oh my, Donna, where do I start? For your information most of the mess we are in now IS Bush's fault. His wonderful tax cuts for the rich and his Iraq war and other unfunded projects DID put us in a financial crisis. And in case nobody has noticed the Republicans if they are elected want to continue the very tax cuts that helped put us in our mess. There is absolutely no evidence anywhere that tax cuts for the rich create jobs. They sure didn't save any jobs under Bush, either. The hemorrhage of jobs started under the Bush administration.

As for vacations, President Obama has had something like 45 vacation days and your Bush at the same time in his administration had hundreds of days of vacation, mostly at his ranch. Keep in mind, when any president goes on vacation they still have things to do every day and are informed as to what is going on in the world and would be available to handle any emergency that may come up.

I don't agree with everything our president has done but the consensus of opinion is that he prevented a financial disaster. Let's give him a little credit, huh?

Maybe Fox didn't mention all of this information??

donna h.

7:40PM PDT on Aug 27, 2010

IN CASE YOU HAVE NOT NOTICED, OBAMA HAS BEEN PRESIDENT FOR TWO YEARS AND THE ONLY THING HE HAS DONE IS BLAME BUSH AND GONE ON VACATIONS AND ACT LIKE A MOVIE STAR. BUSINESS CANT HIRE WHEN HE IS PLAYING GAMES WITH THEM AND THE PUBLIC, YOU CAN NOT SPEND MONEY WHEN YOU DONT HAVE A JOB, AND SINCE OBAMA BECAME THE STAR, IVE NEVER SEEN SO MUCH UNEMPLOYMENT. MAYBE HE AND HIS WIFE SHOULD TAKE LESS VACATIONS AND FLYING ALL OVER ON OUR MONEY, AND PAY ATTENTION TO THE ECONOMY. YOUR PARENTS NEVER HAD BIG BITCHES ABOUT THE JOBS OR WHAT THEY COULD GIVE YOU. UNTIL BAM BAM TOOK OVER, UNEMPLOYMENT WAS 8% WHEN BUSH WENT OUT AND NOW IN SOME PLACE ITS 14% ITS OBAMAS WATCH,IF HE WOULD GET BLAMING BUSH AND DO SOMETHING, HIS CHANGE STINKS.

Belinda L.

12:21PM PDT on Aug 26, 2010

I know consumer spending drives the economy, however I must limit my spending to needs. I must stretch my dollars to provide the needs. Let the rich spend--they have it, I don't.

Dwayne H.

10:03AM PDT on Aug 26, 2010

government should stop using tax-payer money to bail out ANYTHING. no more "oh we have to rush and push this bail out through, we'll worry about details later" garbage that was thrown at us by congressmen, apparently OWNED by big business.

where are all the small business loans (and everything else promised) by the "financial district" when they were bailed out for conducting incredible bad practices for years, all in the name of greed, with the understanding that the US TAX PAYER would bail them out????

all i see is rising interest rates, backroom deals, and looking at reports - very very very little loans being made to the main street people/businesses that bailed out these financial district "people".

if intentional greed causes a national crisis - then why are these terrorists not being charged as such?

who is being charged with 11 murders at BP? anyone in the business can tell you that the heavier muds are put inplace for deep water drilling, in order to simulate the pressure and keep the oil from bursting thru all crazy like it did.

that was an intentional decision made to use salt water instead of mud, and there could only be ONE result of that "short cut" -- those 11 deaths are the result of a conscious decision to destroy the drilling process.

example after example of corporate greed resulting in death, unemployment, national crises -- yet none of these evil people are forced to face the consequences of their terrorism, murder, and even direct att

Walter G.

7:06AM PDT on Aug 26, 2010

The businesses are correct, we are not spending. We don't have the money to spend, thanks to their capitalistic greed. Apparently what we need in the American nightmare, is less businesses.

Hope S.

5:36PM PDT on Aug 25, 2010

Since the media is mostly owned by the wealthy they are promoting the Republicans. Until the voters understand the
Republicans are being manipultated by the wealthy to promote their own agenda and not the regular citizen's or the country's
wellfare. They are fighting for their gross profits. Since the large corporations have abused their powers the government should step in and put the brakes on these abuses. The goernment should also reinstate the Usury Law because the credit companies are charging excess interest and fees. While all the press is talking about the number of failing mortgages and blaming the holders of those mortgages it was corporate America that exported the jobs that enabled people to pay for not only their mortgage but other goods and services. When the CEO's of those large corporations changed their companies' bylaws and gave themselves exorbitant salaries and stock options as well as other perks they were put in a position that they only thought of the bottom line; not the welfare of their stockholders or their employees. Their arrogance is without bounds. Obama's tax reform doesn't go far enough in taxing the very wealthy. If someone is making more than a million then they should pay 90% of the excess in taxes. That would put an end to their greed and would also mean they would have to hire more employees because those salaries are tax deductible.