Where did the jobs go?
* Nearly 70 percent of the job loss we have experienced occurred during the 2001 recession and immediately after the attacks of September 11th. The attacks were a serious blow to our economy, closing the New York Stock Exchange for nearly a week and shutting down U.S. airspace for the first time ever. In the three months after September 11th, the economy lost nearly one million jobs.
* We are also living in a changing economy. Much of our job growth will be found in high-skilled fields like health care and biotechnology. So the President is responding by helping more Americans gain the skills necessary to find good jobs in our new economy. He proposed more than $500 million for his Jobs for the 21st Century initiative to help train U.S. workers for industries that are creating the most new jobs.
How does cutting taxes create jobs?
* First, the President?s tax relief allowed American families to keep more of what they earn. When families have more money to spend, they will demand a good or service in the market place. When there is more demand, businesses have to produce more goods and services, and they are more likely to hire additional workers.
* Second, by cutting rates, President Bush reduced the tax burden on the 90 percent of small businesses organized as S corporations, partnerships or sole proprietorships and who pay their taxes at the individual income tax rates. Small businesses create 7 out of 10 jobs in our economy. Cutting marginal income tax rates allows small businesses ? America?s job creators ? to invest more of their money in their businesses to expand and create more jobs.
* Third, the President?s tax relief gave America?s businesses, large and small, an increased incentive to make the investments they need to stay competitive and to create more jobs. His tax relief quadrupled the limit on small business expensing to $100,000 and offered larger businesses 50 percent bonus depreciation. These tax provisions reduce businesses? upfront costs when they purchase new computers, trucks and other equipment to make their employees more productive. More productive employees means higher wages and more job opportunities for the companies that make the new equipment.
Some argue that the new jobs being created are replacing good paying jobs with low paying jobs. Is that true?
* There is no data to support this claim. The data only tells us what industries produced jobs and we know that over the past several months, we?ve seen across-the-board growth in the various sectors, including traditionally high-paying sectors such as information, construction, financial activities and professional and business services.
* Total compensation ? wages and benefits ? has increased 3.8% during the last year.
What is the difference between the payroll survey and the household survey of unemployment?
* Both the payroll survey and the household survey contain valuable information about economic conditions but there are more important differences. While the payroll survey is larger, it also excludes many areas of job growth such as new business startups and the self-employed. The household survey may do a better job of capturing these areas of job creation.
* Most important, however, is what they have in common ? both surveys indicate that the economy has turned around and jobs are on the rise. According to the payroll survey, we have added 1.5 million new jobs since last August.
Does the President support another Unemployment Insurance extension?
* The Administration has extended Federal unemployment benefits three times, providing over $23 billion to help 7.8 million American workers. Over the last 10 months, we have seen over 1.5 million jobs created, and the unemployment rate has fallen from its peak of 6.3 percent last June to 5.6 percent this year, and we expect that trend to continue. The Administration will continue to work with Congress on this issue.
Does the President support a minimum wage increase?
* New jobs are being created. The economy has added over 1.5 million jobs since August. The President is focused on policies that will keep the economy growing.
* The Administration will continue to work with Congress to study the various minimum wage proposals.
What more can the President do to increase job creation?
* The economy is strong and getting stronger. The economy has added over 1.5 million jobs since August and the growth is expected to continue.
* To create more jobs, we must make sure America remains the best place in the world to do business.
* Tax relief was vital to getting the economy moving again, and for the sake of job creation, it must be made permanent.
* We need to reduce the number of regulations so business owners can focus on their business rather than spending hours on paperwork.
* We need legal reform to cut down on frivolous lawsuits. Even the threat of frivolous lawsuits puts a damper on job creation, investment and expansion.
* To address the high cost of health care and to help the uninsured gain coverage, the President has proposed association health plans, health savings accounts and medical liability reform.
* We need affordable and reliable supplies of energy so we can reduce our dependence on foreign oil.
* Finally, we need to open more foreign markets to U.S. products and services.
* As we create more jobs, we must help workers gain the skills needed to fill those jobs. That is why the President has proposed an aggressive agenda to help workers retrain for jobs in high-demand occupations:
* The President proposed $23 billion overall for job training and employment assistance in his FY2005 budget ? $2.5 billion (12.5 %) more than in 2001;
* The President has set a goal to double the number of workers receiving job training by reforming the Workforce Investment Act to eliminate unnecessary overhead costs by $300 million to train 100,000 additional workers and by proposing $250 million in his Jobs for the 21st Century Initiative to help America?s community colleges train 100,000 additional workers for the industries that are creating the most new jobs.
* The President?s FY 2005 budget includes $50 million Personal Reemployment Account pilot program to help those Americans who have the hardest time finding work.
* A pro-growth economic agenda and help for American workers to gain the skills to secure good jobs, are the right ways to respond to the challenges of our growing and changing economy.
Does the budget deficit threaten to harm the economy and job creation in the long run?
* Our budget reflects the country?s most important priorities: fighting the war on terror and ensuring economic growth and recovery. We?ll continue to provide whatever it takes to defend our country, protect our homeland and promote economic security.
* The President?s budget calls for cutting the deficit in half over the next five years. His plan is to continue with pro-growth policies that will increase revenues into the Treasury while holding the line on Federal spending.
* Economic growth and good stewardship of taxpayers? dollars will help us meet the President?s goal of cutting the budget deficit in half in five years.
Will Congress reject the President?s call to make tax cuts permanent?
* The budget under consideration by the House and Senate would ensure that taxes on America?s families will not increase next year. These are important steps toward ensuring that all the tax relief signed into law by the President will continue to assist America?s families and small businesses.
* Failure to extend the President?s tax cuts permanently would mean a massive tax hike on America?s families. For example, in 2005, the tax burden on a family of four earning $40,000 would increase by $915. Raising taxes on the American people would hurt families and hurt our economic recovery.
What are you doing to help manufacturers specifically?
* President Bush recognizes that the manufacturing sector has been especially hard hit. That is why he pushed for tax relief to spur business investment. Because he acted, many manufacturers have been able to take advantage of lower tax rates, the increased small business expensing limit and the 50% bonus depreciation. This tax relief has helped encourage increased business investment in durable goods and other equipment and spurred growth and job creation in our manufacturing sector over the past four months.
* In addition to tax relief, the President has also proposed a series of proposals aimed at cutting the cost of doing business by making health care more affordable, reforming the legal system to cut down on frivolous lawsuits and enacting a national energy policy that ensures an affordable, reliable supply of energy and reduces our dependence on foreign energy. These proposals are particularly important for our manufacturing sector, which shoulders a higher burden for each of these costs than other sectors of the economy.
* The Administration is also working to implement the more than 57 recommendations outlined in the Commerce Department?s Manufacturing Report, which was based on input from manufacturers nationwide.
* Manufacturers are already benefiting from the President?s economic policies. Manufacturing activities are near 20-year highs. New orders are up and jobs are starting to come back. We?ve seen over 64,000 new manufacturing jobs created this year.
