A Win, Win, Win Solution for Addressing Chronic Unemployment

iStock_000004942412MediumWhile the economy is marching toward full recovery, and unemployment numbers are down, those who have been unemployed for a long time, or who have been chronically underemployed have not seen a dramatic improvement in their prospects.  Indeed, many neighborhoods in our country continue to suffer disproportionate levels of under and unemployment, which causes them to remain in blight. 

I propose a fairly simple idea for a pilot program:  rather than paying unemployment benefits or welfare directly to unemployed individuals, the government could pay private businesses to train and employ these individuals.   For a period of three years, the government would fully subsidize the employees’ compensation, and would waive the requirement for the business to pay payroll taxes for the employee.  And in exchange, the business would train and employ the individuals and help them to develop real, marketable skills.  Participation in this program would be purely voluntary on the part of  both the individual and the business.

This would create a win, win, win situation.  Some of the chronically unemployed and underemployed would get a real chance at a lasting job, and the opportunity to develop skills and experience that can form the basis of permanent employment.  There is also the psychological benefit to the individual of earning a paycheck and being part of an active work force.  The businesses would get the opportunity to get essentially free labor to expand or start-up, without the risk and cost involved with hiring new employees. And the government would benefit from both a reduction in the number of long-term unemployed and underemployed citizens, and the general economic growth to be had by investing in growing businesses and communities.  And most importantly, it has the real potential of permanently lifting families out of poverty and dependence on government.