Another call for social-sector jobs
In a New York Times column, Yale’s Robert Shiller calls for a federal effort to battle unemployment by creating precisely the kind of socially beneficial jobs that some Levy Institute scholars have been recommending:
Why not use government policy to directly create jobs — labor-intensive service jobs in fields like education, public health and safety, urban infrastructure maintenance, youth programs, elder care, conservation, arts and letters, and scientific research?
For deficit hawks, Shiller notes that the cost would be modest:
Big new programs to create jobs need not be expensive. Suppose the cost of hiring a single employee were as high as $30,000 a year, several times typical AmeriCorps living allowances. Hiring a million people would cost $30 billion a year. That’s only 4 percent of the entire federal stimulus program, and 0.2 percent of the national debt.
You can read more on this blog about the ideas of Levy scholars along these lines, or you can cut to the chase and read a Levy Policy Brief on this very subject for yourself. Another related Levy publication, this one a Policy Note on job creation and the lessons of the New Deal, is available here.
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Many of us have been advocating this approach for infrastructure employment. The issue has been government rules. Imagine the private sector benefit from Billion spent on roads and bridges using $15 an hour labor. To bad the politicians prefer high cost labor. In a period of significant unemployment one would think jobs would be the priority. Seems that jobs are secondary.
fyi, Tyler Cowen addresses this on his blog:
http://www.marginalrevolution.com/marginalrevolution/2010/08/robert-shiller-is-right-on-target.html
“Employment Assurance” was actually the first recommendation in the original 1935 Social Security report.
“The experience of the past year has demonstrated that making useful work available is a most effective means of meeting the needs of the unemployed. Further, it has been demonstrated that it is possible to put large numbers of persons to work quickly at useful tasks under conditions acceptable to them. The social and economic values of completed projects represent a considerable offset to the economic losses occasioned by millions of unemployed workers…
“In periods of depression public employment should be regarded us a principal line of defense. Even in prosperous times it may be necessary, on a smaller scale, when ” pockets ” develop in which there is much unemployment… And it must be remembered that a large part of the population will not be covered by unemployment compensation. While it will not always be necessary to have public employment projects to give employment assurance, it should be recognized as a permanent policy of the Government and not merely as an emergency measure.”
http://www.ssa.gov/history/reports/ces/ces5.html