Michael Kim landed his job as HomeAway expands to meet growing demand for its online house-rental service.
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Easing the flow of credit, especially to small businesses, has also been a major policy push--and a tricky one to size up. The efficient reallocation of capital is key to any economy but especially to one like the U.S.'s, which counts on dynamism as a competitive advantage. Lending to businesses is down; that much is true. But is that because banks are overly cautious and asset-impaired or because businesses are uncertain about the future--or just aren't creditworthy borrowers? A recent survey by the National Federation of Independent Business found that companies that couldn't borrow typically had declining sales or depressed real estate values. Simply opening the lending spigot doesn't seem to be the answer.
All these ideas are short-term. That's understandable. People who are out of work want immediate solutions. Politicians wouldn't be doing their jobs if they didn't try to give voters what they want.
The conundrum is that the most useful things government can do to encourage job growth aren't flashy initiatives with quickly visible results. "There's no magic wand we can wave over companies that will induce them to go out and hire people," says Matthew Slaughter, an economist at Dartmouth's Tuck School of Business. "We need to think long-term."
If Congress wants more and better jobs in the U.S., it should do things like create a permanent tax break for companies that invest in research and development, make it easier for foreigners who get science and engineering Ph.D.s at American universities to stick around after graduation, and spend serious time and money improving the nation's infrastructure, including the electric grid and broadband network. Such initiatives will not create many jobs that can be tallied on a spreadsheet. What they will do is more important: lay the groundwork for businesses to innovate and grow.
The same is true on the worker side of the equation. If the key characteristics of the American economy are flexibility and forward motion, then we would all be better off if people felt more support--both financial and social--to invest in their education, switch jobs and industries and venture out to start new firms.
Establishing job creation as a discrete goal is a misleading enterprise. Beyond cyclic swings in demand, what we're really talking about creating is not jobs but ideas and technologies and more efficient ways of producing and selling goods and services. If that sounds like a harder goal to set, let alone achieve, that's because it is.
Yet as Austin richly illustrates, in the wake of the worst economic downturn in generations, that sort of innovation is starting to happen. And from that, the jobs will follow.