Treasury: Businesses adds 8.1M workers, qualify for new tax break for hiring unemployedBy Stephen Ohlemacher, AP
Friday, October 8, 2010
Treasury: 8.1M hires qualify for new tax break
WASHINGTON — Businesses have hired 8.1 million workers under a new program that provides tax breaks for hiring unemployed workers, the Treasury Department said Friday.
The report, however, does not estimate how many of those jobs would have been added without the tax break.
President Barack Obama signed a law in March that exempts businesses hiring people who have been unemployed for at least 60 days from paying the 6.2 percent Social Security payroll tax through December. Employers get an additional $1,000 credit if new workers stay on the job a full year.
Treasury released a report Friday estimating that from Feb. 10 to Aug. 10, businesses hired 8.1 million workers who qualify for the tax breaks. They added 1.2 million from July 10 to Aug. 10, the report said.
Many employers have also cut jobs — the government announced on Friday that a wave of government layoffs in September outpaced weak hiring in the private sector, reducing the nation’s payrolls by a net total of 95,000 jobs. However, there has been a net increase of 613,000 jobs since the start of the year, according to the government’s business payroll survey.
“Targeted programs like the HIRE Act tax credit provide an incentive for private-sector employers to hire new workers sooner than they otherwise would,” Assistant Treasury Secretary Alan B. Krueger said in a statement. “Since it’s only in effect through the end of the year, the HIRE Act encourages businesses to accelerate hiring in order to get the maximum benefit from this temporary tax credit.”
Economists have said there is no way to know how many of the unemployed workers would have been hired without the tax credit.
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