Labor, business can unite as economic heroes

Thomas Kochan, MIT Sloan professor, co-founder of the Employment Policy Research Network

Source: The Boston Globe

BUSINESS GROUPS and labor have at least one thing in common right now: a frustration that our politics are producing more hot rhetoric than good jobs, even as crucial national needs go unaddressed. But if private industry and labor unions pool their money and their political influence, they can lead the way toward modernizing an aging national infrastructure that dulls America’s competitive edge. In doing so, they would also start building the kind of longer-term economic compact necessary to sustain the high-quality jobs that the nation desperately needs.

The United States needs some kind of national infrastructure bank – an entity that would provide the financing for long-overdue repairs and improvements to our roads, bridges, and other public works. There is a $2.2 trillion backlog of such projects. Amid rising concerns about federal spending, infrastructure investments are more efficient economic drivers than tax cuts or other stimulus spending in achieving these goals.

Moody’s Economy.com estimates every $1 spent on infrastructure generates a $1.59 increase in GDP. University of Massachusetts Professor Robert Pollin has shown these projects generate between 20 to 30 percent more jobs than equivalent tax cuts. Read More »

The Verdict is in on June’s Employment Report…and what to do about it

Thomas Kochan, Co-director, MIT Institute for Work and Employment Research

According to the World Commission on Environment and Development, a “sustainable” economy must meet the needs of the present while not compromising the ability of future generations to meet their needs.  By this standard, the American economy  is definitely unsustainable:  It is not creating enough jobs to meet the current or future population’s needs and the long term trend in job quality is destined to produce a declining standard of living for today and tomorrow’s workers.

 June’s dismal unemployment numbers are just the latest indicators.  The economy created only 18,000 new jobs (about 130,000 less than needed just to keep up with the growth in the labor force) and unemployment rose to 9.2%.  Moreover, hourly wages over the past year lagged increases in prices by  1.5%. 

These numbers, coming on the back of an equally bad report last month make it painfully obvious that the nation needs a new, aggressive, and comprehensive employment strategy, one that creates jobs directly and successfully engages business and labor in efforts to build a sustainable recovery and economic future. Read More »