Spurring Job Creation in Response to Severe Recessions: Reconsidering Hiring Credits

David Neumark

No 16866, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The continuing adverse labor market effects of the Great Recession have intensified interest in policy efforts to spur job creation. In periods when labor demand and supply are in balance, either hiring credits or worker subsidies can be used to boost employment - hiring credits by reducing labor costs for employers, and worker subsidies by raising the economic returns to work. Historically, both types of policies have been used in pursuit of distributional goals as well, with hiring credits targeting employment of disadvantaged workers, and worker subsidies targeting low-income families. Hiring credits targeting the disadvantaged have generally been regarded as ineffective at both creating jobs and increasing incomes of low-income families, whereas worker subsidies have been viewed as more successful at both. However, in the context of the Great Recession - and severe recessions more generally - hiring credits may be particularly effective at spurring job creation, but only if they are designed quite differently from past hiring credits targeting the disadvantaged. Moreover, establishing a national hiring credit that kicks in during and after recessions may be an effective countercyclical measure - a useful addition to the "automatic stabilizers" already in place, and one that specifically targets job creation.

JEL-codes: J08 J2 J78 (search for similar items in EconPapers)
Date: 2011-03
Note: LS
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published as Kenneth A. Couch & Douglas J. Besharov & David Neumark, 2013. "Spurring Job Creation in Response to Severe Recessions: Reconsidering Hiring Credits," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 32(1), pages 142-171, 01.

Downloads: (external link)
http://www.nber.org/papers/w16866.pdf (application/pdf)

Related works:
Journal Article: Spurring Job Creation in Response to Severe Recessions: Reconsidering Hiring Credits (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:16866

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w16866

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().