Why Job Growth Matters More Than Deficit Reduction for the Economy

The United States Bureau of Labor and Statistics released the jobs report for August 2011 and the outlook didn't look promising. In fact, no new jobs were created in the U.S. for the month of August. This shocking statistic highlights the lack of employment growth in the U.S. In addition, the overall

remains at 9.1%, which further signals a sluggish economy. The U.S. cannot afford employment and opportunity stagnancy in both the public and private sectors. Although deficit reduction receives a lot of attention, job growth is more important. Reasons why job growth must take precedence over deficit reduction include:

The fragile economy faces the risk of falling into a depression. The GDP, while tepid over the past few quarters, has still shown signs of growth. Prolonged unemployment even makes achieving the low 2% GDP growth of previous quarters impossible to maintain. GDP growth can't occur in future quarters without a major

. It has grown increasingly evident that private sector job growth has spiraled downward, and companies no longer hire new employees. Some companies can't afford to hire new employees. Other companies seem content to enjoy their profits, and to wait for an economic recovery before hiring new employees Companies survived cutbacks, layoffs and restructuring. Once they rebounded and became profitable again, they had learned to do more with less; they have no reason to start investing money into new hires again. An economic recovery can't happen unless companies begin hiring new employees for skilled jobs and careers. Job growth can give the economy a much-needed boost, unlike deficit reduction.

Deficit reduction may help the long-term health of the government, but it cannot improve current economic performance. The government cannot cut its way to growth. Government spending cuts mean reduced funding for agencies. Reduced agency funding then causes layoffs and job terminations. This only raises the unemployment rate, by decreasing the amount of federal and state jobs. We definitely need long-term deficit reduction, but we need it when we have a strong economy. Focusing on job growth benefits everyone and can help reverse the economic downswing.

No major jobs bill has focused on creating long-term permanent jobs. Many temporary measures and short term band-aids were not nearly focused enough to make a dent in the unemployment rate. Both Democrats and Republicans have failed to focus on the number one issue that plagues the lives of most Americans. Many advantages accompany a focus on jobs and jobs growth. As more people find work, the country experiences increased tax revenue. When people have jobs, they have expendable income, to put back into the economy. The government can use this money to help pay down the long-term debts of the government and to reduce governmental borrowing.

Many Americans have little faith in the government because the priorities of the federal government seem out of order. Instead of focusing on deficit reduction, the government should focus on creating new jobs. Any plan for economic recovery will include saving jobs and creating new jobs. The $447 billion jobs package proposed by President Obama may be a step in the right direction. Hiring new employees for skilled labor jobs and professional careers with salaries well above minimum wage can help give the U.S. economy a boost.