President Obama and Vice President Joe Biden will announce a $600 million jobs initiative aimed at community colleges. The White House said the program would offer grants “to support job-driven training, like apprenticeships, that will expand partnerships with industry, businesses, unions, community colleges, and training organizations to train workers in the skills they need.”
In the corresponding video, Yahoo Finance Editor-in-Chief Aaron Task spoke with Lauren Lyster about whether a $600 million program could make a dent in the current 6.7% unemployment rate. “It’s something, right? And that’s a good thing,” Task said referring to the community college initiative. “But it’s not going to move the needle.” He said the only thing that’s going to spur job creation is economic growth, as well as the reports yesterday about an increase in capital expenditures from business.
Task suggested an investment in infrastructure may be a more effective stimulus to create long-term growth. Task said a $600 billion program could put people to work, but that’s unlikely to happen because of current politics in Washington.
Infrastructure employment has declined since the start of the financial crisis. U.S. public construction spending as a percentage of GDP is at a 20-year low as of May 2013. The construction industry lost two million jobs between December 2007 and January 2011. The industry recovered almost 400,000 of those jobs by last October, but remained 22% below pre-recession employment levels.
There’s been a drop in highway construction as well since the start of the Great Recession. The 2009 federal stimulus had a $46 billion infusion for transportation spending, but it didn’t compensate for cutbacks by state and local governments – who provide the majority of money for roads, bridges and highways.
Task said the flaw in the stimulus plan from President Obama’s first term was that the money wasn’t put towards the right kinds of infrastructure. “They didn’t do enough building,” he said. “That is the kind of spending that the government does that [pays off] for corporations, for society as a whole, for a long period of time.”
- Politics & Government
- Budget, Tax & Economy
- President Obama
- The White House
- Vice President Joe Biden
- community colleges