(ATLANTA, GA) Today’s release of the jobs report for December by the U.S. Bureau of Labor Statistics revealed 292,000 jobs created and an unemployment rate of 5.0 percent – yet this performance won’t kick the economy’s recovery into high gear. The CEOs of Job Creators Network point to persistently sluggish GDP growth and a shrinking labor force participation rate as the more relevant measures of the economy’s true health, and suggest small business tax reform as the formula for jump-starting prosperity.
“We are going on seven years since the recession ended, yet 2015 marked a full decade of annual economic growth that never once hit 3 percent or better,” said Stephen Bienko, founder and president of 42 Holdings, a franchisee of College Hunks Hauling Junk, and a member of the Job Creators Network. “A related symptom: 2015 also featured the lowest percentage of working-age adults not participating in the workforce that we’ve witnessed in three decades.” From 1996 to 2005, annual U.S. GDP growth averaged 3.4 percent, matching or topping 3.5 percent for six of those years, but has failed to exceed 2.5 percent in any year since the recession that began in 2007.
The percentage adults ages 25-54 participating in the labor force hovered around 81 percent for most of 2015, a low level that has not existed since 1984. Prior to and even during the recession that began in 2007, the participation rate for this key demographic was pegged around 83 percent and better. The difference between 83 and 81 percent means 2.5 million additional people were not participating in the work force during 2015, but not counted in the monthly unemployment estimates.
“The United States has the highest corporate tax rate in the industrialized world and that’s an anchor around the necks of the small entrepreneurs who create most of the new jobs,” continued Bienko. “Those millions of displaced people in the prime working years of their lives won’t jump back into the job market until Congress and the Administration get serious about bringing small business back with pro-growth tax reform.”
Next week, Job Creators Network will launch the Bringing Small Business Back initiative, aimed at encouraging Washington to help small entrepreneurs by passing fundamental tax reform, easing the regulatory burden, and improving access to investment capital.
JCN is a nonpartisan organization founded by entrepreneurs like Home Depot co-founder Bernie Marcus who believe the best defense against bad government policies is a well-informed public. JCN members talk about paychecks, not politics, helping the public, policymakers and their own employees understand what is needed to create jobs. For more information about JCN and its Employer-to-Employee (E2E) education program, please visit www.JobCreatorsNetwork.com and InformationStation.org.