Just a quick link to a good short article in the Wall Street Journal where the author uses his own business to explain why he refrains from hiring new employees. It's not a big article, I'll just quote the summary :
A life in business is filled with uncertainties, but I can be quite sure that every time I hire someone my obligations to the government go up. From where I sit, the government's message is unmistakable: Creating a new job carries a punishing price.
The sad fact is that a high unemployment rate is here to stay for a very long time or more likely permanently. This will create a new welfare class in addition to the numerous ones we have now: public workers, military, vets on the gi bill, students on federal tuition assistance, the single mothers with six kids living on welfare etc. We are living in a new norm and a new economy. Our generation will be the 1st to have a lower or at best the same standard of living than our parents due to the fact that a lot of our income will be going to the government and paying down the massive debt, 130 yes 130 trillion dollars. http://article.nationalreview.com/436123/the-other-national-debt/kevin-williamson?page=1
ReplyDeleteRetirement is not for our generation.
The fact that businesses, banks, and individuals are hording around 1-2 trillion dollars was recently in the news, I don't have the article. The reason for this is due to all of the uncertainty in the economy due to all of the new government regulations: Health care, FINREG, Massive tax increases coming at the 1st of 2011, and the government's push for more reforms. Business simply don't know how much it will cost to hire people. Like one of the authors of the FINREG bill stated, No one will know how the bill will work its in place. New stuff is being learned about the FINREG and Health care reforms everyday.
The unemployed insurance is another factor keeping unemployment so high. People are just taking a vacation and living for free without working. I know people that have family members that have been on unemployment insurance for a long time and aren't even trying to find a job.
Once people get their confidence back this trillions of dollars will be pumped back into the economy increasing the money supply and the velocity at which it is circulating throughout the economy creating the potential for massive inflation. Although deflation is the fear as of now. Historically deflation has preceded inflation.
Another trend in businesses hiring practices is to hire temp workers or to hire part time employees so they don't have to provide benefits. I know at the company I work at employees hours are being cut just below or far more below the 40 hour mark and people being hired are being hired on as part time employees.
I want to enter back into the work force full time but due to all the uncertainty I am hesitant. The economy will get better and it has but there will be a new norm.
On the 'sacred' military being a welfare class it is a fact. http://www.military.com/features/0,15240,218378,00.html
ReplyDeleteThe average hourly pay for a member of the military is 21 dollars. A person can retire at the age of 42 and collect over a million dollars in benefits before they die. Aside from combat vets that have been injured, this is excessive.
"'I've heard a four-star military leader comment that DoD is turning into a benefits company that will occasionally kill a terrorist,' Punaro said in a phone interview Tuesday. The remark plays off a popular critique of General Motors before its recent bail out, that union contracts had transformed it into a health care company that occasionally built a car."
BUT, the military is a great career choice and I wish I would have stayed. But it is what it is.
Though you do have a point, you are being much too harsh on the military, Jeff. Being the one non-union part of the government, they are paid at a much lower level, at least in direct pay, than in the real world. I can tell you that, as an engineer in the real world, I'm making about what a Brig General makes. My responsibilities aren't anywhere near, by orders of magnitude, what their responsibilities are.
ReplyDeleteI don't have any facts, but I would bet a Blackwater Security guard in Iraq makes much more than an E-5 does.
You may have a point on the retirement, maybe not. Anyone retiring at 42 from the military still needs a real job, but it is the only place you can get that kind of deal at that young of age.
I don't think I am being too hard on the military. I think when all of the benefits are factored in the military makes above what the private sector does.
ReplyDeleteBut major cut in military benefits and reforms to the retirement benefits and health care cost are coming, just like cuts are coming in social security, medicare etc. http://www.aolnews.com/nation/article/pentagons-real-budget-battle-cutting-military-health-care/19587704?test=latestnews
All of these benefits that various groups are "entitled" to are simply not there, it is all an illusion. When this house of cards falls and the public realizes that all of these benefits that they feel just as entitled to as the military does for its benefits, a lot of people will not be happy. This will be a major event that will happen in our lifetime, mine at least. Especially with the new economy, the military will not have a hard time finding qualified recruits and will have no reason to continue these excessive benefits.
JFCOM is being axed and military contractors are going to be cut by about 10%.
"Defense Secretary Robert Gates' vow to shut a major military command and eliminate thousands of contractor jobs to plug a 'gusher of defense spending' will do little to reduce the Pentagon budget but will prove a breeze compared with cutting military health care costs."
I highly doubt these benefits will be cut to any great extent until a breaking point is reached.
I watched "Enemy At The Gates" and compared to armies of the past our military has it made. Those Russians soliders were being drag into combat without weapons and being shot by their own for turning back.