The Real Reason Why Job Creation Numbers Are A Sham
The head talkers of Washington D.C. and talking heads of Wall Street are in a frenzy about job creation numbers.
What is the meaning of job creation?
How is a job created?
Is a job saved the same as a job created?
With the unemployment rate soaring into double digits, the so-called experts offer a range of theories and programs that are designed to create jobs and/or save jobs.They believe the twist of a pen could create a million jobs–or save a million jobs, whatever.
Still another rash of programs, taxes, and penalties are promising to help build the “green economy.”
Bunk.
The key ingredient of job creation has nothing to do with jobs: it’s value creation that should be the primary factor. The idea that an interest group, a legislative body, or an executive can create permanent jobs is nonsense. And the idea that you can manipulate an economy with taxes and caps to promote a cause–no matter how deserving–is even more ludicrous.
You must first create value before you can create jobs. You must add to the value proposition for “greening” the economy before you can create green jobs.
Value is created by increasing efficiency, lowering costs, and improving productivity. The value must be direct and realizable, as well.
Not only will these programs not work, they flirt with the law of unintended consequences, sort of like how Prohibition emboldened organized crime.
There are other indications that the jobless numbers are less than accurate–the books have been cooked for awhile on unemployment. But, the true falacy of the debate on unemployment is that jobs and employment can create value, instead of the other way around.
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