Fix jobs and housing will followby Tim Manni
President Obama addressed lawmakers in a press conference yesterday urging them to vote in favor of a $447 billion jobs bill:
“Any senator out there who’s thinking about voting against this jobs bill, when it comes up for a vote, needs to explain exactly why they would oppose something that we know would improve our economic situation at such an urgent time,” Obama said at a White House news conference yesterday.
Obama proposes to cut payroll taxes for workers and employers by half, extend jobless benefits, provide aid to states for schools and emergency workers and boost spending on public works projects such as roads and bridges. It also would provide tax breaks for employers to hire the unemployed.
Granted, Obama is expected to run into resistance in a Republican-controlled House since the president plans to pay for this bill with tax increases on wealthy Americans.
Payrolls increased last month
The president’s news conference yesterday was a precursor of sorts to today’s unemployment report which saw payrolls increase by 103,000 and the unemployment rate hold at 9.1 percent.
Both the July and August unemployment figures were revised upward and the 45,000 Verizon workers on strike in August returned to work last month. While this can be interpreted as a budding positive trend, employment figures are still too inconsistent and too meager at this point to really add to the country’s economic output.
Jobs and housing
We’ve explained the relationship between jobs and housing on this blog several times before (here and here), but we would be remiss if we didn’t provide further indication of just how important the jobs market is to getting our nation’s housing market back on track.
A simple and interesting graph from National Association of Realtors explains that it’s no coincidence that the strongest local economies are those least affected by the housing downturn:
The connection is no coincidence as housing and construction play an important role in economic growth and job creation. As prices and sales declined in these markets, so did employment in construction, housing related services (lawn care, pest control, pool care, etc.) and retail sales (home electronics, furniture, home improvement centers, etc.). This cycle spiraled downward and resulted in more layoffs as local governments and businesses pared jobs to reduce costs. Some of these markets have made headway in recent months, but job creation remains an issue.
How much resistance will the president’s job bill receive?
We’ll have to wait and see. But the country’s growing frustrations–as demonstrated by an increasing number of protests across the country–is putting the pressure on Washington. Furthermore, President Obama will have to make serious strides with this country’s unemployment problem (thus the housing problem as well) if he hopes to remain in the White House for a second term.