Paying Businesses to Hire Unemployed Residents

Anonymous's picture

 

As an incentive to encourage businesses to train and hire unemployed residents, San Francisco doubled its wage subsidy to $5,000 per employee. In theory, wage subsidies have potential to build skills and create long-term employment opportunities for welfare recipients. Despite facing a $306 million deficit, the city says it has more than $1.5 million left in the program, enough to cover two to three months’ worth of wages for 250 to 300 workers.

On the surface this antipoverty measure will help reduce short-term unemployment, but the issue is whether those hired with a subsidy will stay employed after the subsidy expires, and whether wage subsidies will have a long-term impact on ending welfare dependency and the culture of poverty.  

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/04/12/BARE1IUENA.DTL

harris2's picture

Hired for how long?

After reading the article, the program Jobs Now and Jobs Now 2 represents a fantastic initiative aimed at helping busineses hire unemployed workers. But with the program resting on some $1.5 million, barely enough to support around 300 workers for a few months, it seems more like an experiment for stopping unemployment rather than a solution. With unemployment in San Francisco around 9.6%, small amounts of funding for unemployed workers negates a strong influence. If the program was far reaching, then it's benefits would be unmeasurable, but the short funding from the previously debunked federal program seems a short answer for high unemployment.
Maria Balilo's picture

Job stimulus for San Francisco

The limited funding is a legitimate concern, but to me the advantage of wage subsidies is the fact that they can stimulate the expansion of job opportunities especially those with stigma in society, i.e. welfare recipients. It's excellent for boosting morale among the unemployed and encouraging skill-building among people not traditionally given opportunities. Long-term economic effects are hard to predict, but wage subsidies are a very progressive attempt at restoring among the marginalized a sense of relevance in society. To me that's a step in the right direction.

Paid for by Phil Ting for Assembly 2012. FPPC ID# 1343137