Yesterday prominent politicians gave a speech in New York City that boasted about the administration’s handling of the economy, taking credit for the current 5.1 percent unemployment rate. But recent polling done by the Job Creators Network confirms what real Americans already know: This topline unemployment number is no longer a good indication of the state of the economy.
Our survey found that more than one-in-two Americans know someone who is unemployed and would like a job right now, suggesting that the real employment situation is far worse than the establishment says. This is proven by the fact that there are about the same number of people working full-time today as there were before the recession — even though the population has grown by 18 million people over that timeframe. And by the statistic that American businesses are now closing at a faster rate than opening for the first time in recorded history.
Rather than taking credit for a manufactured unemployment rate, then, governments should be taking responsibility for a labor market that by many indicators is still at recession levels. The speech did acknowledge the problem of stagnant wages, but the proposed solution – a $15 minimum wage – would do more harm than good. You can’t legislate prosperity.
Our survey suggests that Americans get this, finding that a clear majority are skeptical of governments’ attempts to improve the labor market by increasing minimum wages. Two-thirds of respondents agree that a $15 minimum causes lost jobs and fewer hours, exacerbating wage stagnation rather than improving it.
That’s not to say that Americans don’t recognize that living on the minimum wage is hard – especially with stagnating wages and rising prices. But there is a better option that can actually help low-income employees without putting their jobs and small businesses at risk. It’s known as the Earned Income Tax Credit, and it supplements the incomes of low-income employees through the tax code at a sliding scale as wages increase. This would allow low-income employees to live a little easier without threatening valuable work and training experience that are necessary for them to someday earn far more than the minimum wage.
The speech overlooked the only way to actually help improve the labor market and wage stagnation: Get government off the backs of small businesses. Reverse the countless new taxes, labor regulations, and wage and benefit mandates put on job creators that prevent them from expanding, hiring, and paying higher wages and the labor market would finally improve and wages would finally rise.
Our survey concludes that the overwhelming majority of Americans agree with this approach: 68 percent of respondents said that entrepreneurs and business owners are responsible for creating jobs, not governments. If only our elected officials would listen.
Alfredo Ortiz is the president and CEO of the Job Creators Network