I don’t understand why companies are not hiring more people. I understand the big layoffs in 2008. The stock market crashed in the wake of the housing market bubble collapse and the financial crisis that came from the banks’ mismanagement of bad debts; companies couldn’t afford to maintain the level of employees. But now things are different.
The stock market is higher than before the 2008 crash, and the housing market is stable and improving. So why is our country’s unemployment rate still at 7.7 percent?
It’s popular to blame the government and taxes that prevent job creation. But I did some research, and according to the Congressional Budget Office, U.S. corporations paid approximately 1.2 percent GDP in taxes during 2011. This was below the pre-crisis 2.7 percent level in 2007 and below the 1.8 percent average for 1990-2011. Not to mention that the U.S. corporate after-tax profits were at record highs during the third quarter of 2012.
So if there is all this corporate prosperity and taxes really have little to no impact, why are companies still so afraid of hiring more people?
Henry Ivey West III