Fire the job creators

As we’ve all heard, the job of those high-income earners who benefit from Bush-era tax cuts is to create jobs. But they seem to be slashing jobs more than creating them. So why do the job creators still have jobs?

In all seriousness, it’s disingenuous to expect businesses to create jobs. Whether a business sees itself as maximizing profit or maximizing value for a customer’s dollar, employees are expensive and therefore job creation needs to be avoided.

As a software developer, I’ve probably eliminated at least as many jobs as I’ve created. Mostly I’ve eliminated work, which allows people to work on other things and changes the nature of the job. That’s a productivity increase, but not one that gets measured in government statistics. I think I’ve generally made life better for those who have used my software, and the same is true for computer programmers in general. But there’s no guarantee that new jobs (e.g. webmaster) will outnumber the old ones (e.g. phone answering service.) My sense is that most job-creating innovation comes from individuals making incremental improvements to their own jobs, or even inventing their own jobs. And for that kind of innovation you need a middle class with enough of a safety net to take risks.

But it’s not just me. Recently NPR interviewed millionaires affected by the latest tax proposal, and they didn’t manage to find a single one whose hiring decisions would be significantly influenced by changes in the tax rate.

Advertisements