The other day, Jay Hancock wrote an article about how many employers aren’t hiring even though they have the cash and customers to expand.  Indeed, this is a question many have been asking recently.  Businesses are doing better, so why aren’t we seeing a decrease in the unemployment rate?

Of course, there are a lot of reasons for this.  The first and simplest is that more people are probably looking for work now that they know that there should be jobs available.  I’m sure many people got discouraged during the worst of the recession and either decided to stay unemployed without even looking for a new gig or stick it out at a place they didn’t like, perhaps only part time.

Now that we’re supposedly in recovery, they’ll start to look again, and we must add them to the unemployment stats.  Some people don’t know this, but “unemployment” only includes those without jobs who are actively looking for them -- otherwise the rate would be a lot higher, as it would include retirees, children, students, and spoiled lay-abouts.

So there’s that.  But the slight uptick in people who have resumed their job search doesn’t explain why companies are still so cautious about hiring.  Some people (not Hancock, to be clear) allege that it’s a conspiracy -- that big businesses are trying to oust our current administration by prolonging the recession and encouraging a change towards more conservative leadership.[1]

I think conspiracy and collusion here is unlikely.  Companies are motivated by self-interest, just like us.  If they thought they could earn more money by expanding operations ahead of the competition then they would do it.  I do, however, think that our current administration has a large part to play in this jobless recovery.

Since his inauguration, President Obama has made it his mission to overhaul the way America functions.  We have bailed out private industries that didn’t make the cut, drastically changed the healthcare industry, curbed back our spending for defense, increased the power of government, and spent an extraordinary amount of money to do it all.  Right now we’re in debt, but we’re already talking about ways to bridge the gap.

This “gap-bridging” is likely to be done by raising taxes, and since Obama seems hesitant to saddle middle and lower class America with much of the burden, it will likely be the rich and the corporations that must step up and pay for it all.  Of course, since no one knows exactly what to expect, they must remain cautious.  After all, why hire a bunch of new employees and invest all the money required to train them if you’re only going to have to lay them off in a few months when your taxes increase?

It is this uncertainty that is keeping our economy from properly recovering.  Unlike the government, private industries can’t just keep spending money on a project if they can’t identify a source of revenue.[2]  Uncertainty is a big no-no in the business world -- something our current administration doesn’t seem to understand.

Maybe after we’ve run out of money to borrow the government will turn to alternate means of spurring job growth.  For example, they could make a law that says that any individual or corporation with money to spare above a certain threshold must begin hiring people until they are bankrupt.  Then we’d all be in the same boat together.