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We must create jobs

Julianne Malveaux | 11/23/2011, 5 p.m.

Last week, I had the opportunity to testify before the Congressional Progressive Caucus. I am grateful to Congressman Keith Ellison for the invite. Here are excerpts of my testimony:
While I am sure that you are familiar with the data, I would like to take a moment to discuss the magnitude of the unemployment challenge.

Officially, the unemployment rate in October was 9 percent, which meant that, officially, 13.9 percent of all Americans were unemployed. About 5.8 million of these folks, or 42 percent of the unemployed have been without work for more than 27 weeks, or half a year. The average unemployed person has been out of work for 39 weeks.

But these data are a pleasant fiction that ignores the reality of our nation's unemployment. From Table A-15 of the monthly Bureau of Labor Statistics Employment Situation report (USDL-11-1576), we learn that when those marginally attached to the labor force and those working part-time who want full-time work are included as unemployed, the rate for all Americans soars to 16.2 percent. That means that one in six Americans are unemployed.

The situation is far more severe in the African American community, where the unemployment rate is 15.1 percent. This represents an improvement over the 16 percent rate that was measured last month, yet this is a rate that is still too high. If we look at this through the lens of the A-15 data, using the same projection that is used with overall rates, the 15.1 percent Black unemployment rate actually looks more like 27.2 percent.

African American men over age 20, with an official unemployment rate of 16.2 percent, actually experience unemployment at the 30 percent rate. In some of our nation's largest cities, half of all African American men do not have work.

It is important to review the magnitude of this problem, because different tactics may be used to respond to a 9 percent unemployment rate than a 16 percent unemployment rate, or a 27 percent unemployment rate. A 9 percent rate might simply be considered a challenge, but a 27 percent rate, or the 30 percent rate for African American men must be considered a crisis.

What are the solutions, then, for the challenges we face? Not only must the federal government be involved in job creation, but the private sector must be offered incentives to be part of this solution. We have a rich tradition of federal involvement in job creation, ranging from the Depression era Works Progress Administration (WPA) to the JTPA (Jobs Training Partnership Act) of the 1980s. There are unmet needs in public infrastructure, in healthcare, and in social services. Creating 5 million jobs at $50,000, with benefits and administrative costs would run us $500 million, and would reduce the unemployment rate by about 5 percent, and would increase tax revenue significantly.

It would be my recommendation that employment funds flow to cities, not states, as urban issues are far more acute than statewide issues, and because cities are likely to be blacker, browner, older, younger, and both richer and poorer than the rest of America.