[Congressional Record (Bound Edition), Volume 159 (2013), Part 13]
[Extensions of Remarks]
[Pages 19153-19154]
[From the U.S. Government Publishing Office, www.gpo.gov]




     ON THE INTRODUCTION OF THE REDUCING LONG-TERM UNEMPLOYMENT ACT

                                 ______
                                 

                       HON. ELEANOR HOLMES NORTON

                      of the district of columbia

                    in the house of representatives

                      Thursday, December 12, 2013

  Ms. NORTON. Mr. Speaker, I rise today to introduce the Reducing Long-
Term Unemployment Act, to address one of the lingering workforce 
tragedies resulting from today's economy--our long-term unemployed--and 
to spur economic growth. While millions of Americans are unemployed, my 
bill targets those particularly hard hit by unemployment. In November 
2013, the number of long-term unemployed (those jobless for 27 weeks or 
more) was 4.1 million, which accounted for 37.3 percent of the total 
unemployed population.
  To make matters even worse, the unemployed now face employment 
discrimination and employers are reluctant to hire the long-term 
unemployed because of the length of their unemployment. Therefore, my 
bill provides a necessary incentive--a $5,000 tax credit for employers 
against their payroll tax liability for each (net) new long-term 
unemployed person they hire. The tax credit is large enough to give 
employers an incentive to increase hiring and wages, which would inject 
demand into the economy. The credit would be available to the broadest 
base of employers because every employer--government, non-profit and 
for-profit--pays payroll taxes, and employers could claim the credit on 
a quarterly rather than annual basis. According to the independent, 
non-partisan Congressional Budget Office, the proposal would ``increase 
both output and employment,'' through four mechanisms: (1) with lower 
employment costs, employers would reduce the costs of their products 
and services, which, in turn, would first boost sales and then hiring 
and hours worked; (2) employers would pass on some of the tax savings 
to employees in the form of higher wages or other compensation, which, 
in turn, would increase employees' purchasing power; (3) higher profits 
would lead to higher stock prices for public companies, increasing 
shareholders' wealth and therefore their willingness to spend; and (4) 
with lower employment costs, employers would increase hiring. The bill 
has safeguards to prevent employers from gaming the system, including 
denying a credit to an employer that fires one employee and hires a 
replacement.
  For some time, it has been clear that policies to address today's 
unusually stubborn unemployment need to be targeted in order to be 
effective. Without significant targeting, the long-term unemployed are 
in danger of becoming permanently unemployed. This group deserves 
better. The long-term unemployed are also at risk for losing their 
unemployment benefits without an extension of the Emergency 
Unemployment Compensation program before December 28, 2013. I ask the 
House of Representatives to support this bill because it targets this 
too-often neglected group of Americans.

[[Page 19154]]



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