Tags: Zuckerman | unemployment | recession | uncertainty

Zuckerman: Obama's Jobless Recovery Is 'Phony'

By Dan Weil   |   Tuesday, 16 Jul 2013 01:00 PM

The nation's recovery from the recession is "phony," with the employment picture remaining bleak despite President Barack Obama's claims to the contrary, Mortimer Zuckerman, chairman of U.S. News & World Report, charges in a hard-hitting Op Ed, Tuesday.

Part-time workers are taking the place of full-timers, with even the government employing more than 2 ½ times as many part-timers as it did a year ago, Zuckerman says in the piece for The Wall Street Journal..

"At this stage of an expansion you would expect the number of part-time jobs to be declining, as companies would be doing more full-time hiring," he writes. "Not this time.

"In the long misery of this post-recession period, we have an extraordinary situation: Americans by the millions are in part-time work because there are no other employment opportunities as businesses increase their reliance on independent contractors and part-time, temporary and seasonal employees."

Zuckerman lays the blame for "the longest and worst recession since the end of World War II," at the feet of government policies — especially Obamacare.

"The health-insurance law requires employers with more than 50 workers to provide health insurance or pay a $2,000 penalty per worker. Under the law, a full-time job is defined as 30 hours a week, so businesses, especially smaller ones, have an incentive to bring on more part-time workers.

"Little wonder that earlier this month the Obama administration announced it is postponing the employer mandate until 2015, undoubtedly to see if the delay will encourage more full-time hiring," he added.

Editor's Note: ObamaCare Secrets Revealed

"But thousands of small businesses have been capping employment at 30 hours and not hiring more than 50 full-timers, and the businesses are unlikely to suddenly change that approach just because they received a 12-month reprieve."

Obamacare isn't the only government policy at work in hindering the job market, Zuckerman says. "These businesses' hesitation to hire is part of a larger caution among employers unsure about the direction of government policy — and which has helped contribute to chronic long-term unemployment that shows no sign of easing."

"What the country clearly needs are policies that will encourage the modernization of America's capital stock, where investment in modern production has plunged to the lowest levels in decades," Zuckerman says. "Policies should also be targeted to nourish high-tech industries, which will in turn inspire the design and manufacture of products in the U.S. where they would be closer to the American market, spurring more hiring."

Zuckerman also sees a need to streamline the patent application process and to implement a major infrastructure program to improve airports.

The standard unemployment rate – 7.6 percent in June – is misleading,  Zuckerman says. When adding people who have given up looking for work along with part-time workers who want to be full-time, the real unemployment rate was 14.3 percent in June, up from 13.8 percent in May.

In the first half of the year, the number of people with jobs rose 753,000, but 557,000 of these positions were only part-time, Zuckerman notes.

"An estimated 22 million Americans are unemployed or underemployed," he says. "They are virtually invisible and mostly excluded from unemployment calculations that garner headlines."

He says it is "imperative that the U.S. focus on innovative and creative policies," or the unemployment crisis will continue even as the economy rebounds.

"Without such a focus, millions of American families whose breadwinners are unemployed or underemployed will remain dispiriting and apprehensive about the future, especially the young who are entering the workforce.

"The country needs a real recovery, not a phony one," he concludes.

Editor's Note: ObamaCare Secrets Revealed

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