The Employment Effects of State Hiring Credits During and After the Great Recession

David Neumark and Diego Grijalva ()

No 18928, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: State and federal policymakers grappling with the aftermath of the Great Recession sought ways to spur job creation, in many cases adopting hiring credits to encourage employers to create new jobs. However, there is virtually no evidence on the effects of these kinds of counter-recessionary hiring credits – the only evidence coming from much earlier studies of the federal New Jobs Tax Credit in the 1970s. This paper provides evidence on the effects of state hiring credits on job growth. For many of the types of hiring credits we examine we do not find positive effects on job growth. However, some specific types of hiring credits – most notably including those targeting the unemployed, those that allow states to recapture credits when job creation goals are not met, and refundable hiring credits – appear to have succeeded in boosting job growth, more so during the Great Recession period or perhaps recessions generally. At the same time, some credits appear to generate hiring without increasing employment or to generate much more hiring than net employment growth, consistent with these credits leading to churning of employees that raises the costs of producing jobs via hiring credits.

JEL-codes: J23 J38 (search for similar items in EconPapers)
Date: 2013-03
New Economics Papers: this item is included in nep-lab, nep-lma and nep-ltv
Note: EFG LS PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (39)

Published as The Employment Effects of State Hiring Credits David Neumark, Diego Grijalva ILR Review Vol 70, Issue 5, pp. 1111 - 1145 First Published December 27, 2016

Downloads: (external link)
http://www.nber.org/papers/w18928.pdf (application/pdf)

Related works:
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:18928

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w18928

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 ().