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Many people
would argue that more government intervention -- along with more public sector spending and borrowing -- is the only answer to our
current woes because the private sector is neither willing nor able to help
out. But two recent reports suggest that isn't necessarily true:
"Paying
Companies to Hire the Unemployed" (CNNMoney)
Would you
donate $6,000 to subsidize someone else's job?
The WorkPlace, a Connecticut non-profit agency, believes the
best way to get the long-term unemployed back into the workforce is by paying
companies to hire them.
But instead of
turning to the government for the money, the agency is trying something
different: asking private companies and citizens to support subsidized jobs.
"In order
to get long-term unemployed people a chance to demonstrate they can do the
job as well as anybody else, you have to use unusual tools and that's one of
them," said Joseph Carbone, the agency's chief executive.
More than three
dozen companies, non-profits, foundations and individuals have donated more
than $580,000 to fund The WorkPlace's initiative,
called Platform to Employment. The AARP Foundation kicked in another $200,000
to assist the jobless over age 50.
The program is
one of the latest efforts aimed at tackling the thorny problem of long-term
unemployment. Millions of people have been jobless for months or years in the
wake of the Great Recession, and it's much tougher for them to work their way
back into the labor force, particularly if they are older.
"Law
Firm's Free Help for Startups Strikes a Chord" (New
Hampshire Business Review)
Who says
there's no such thing as a free launch?
That's the
working tagline for Devine Millimet's Business
Launch Initiative, a unique program started by the Manchester-based law firm
at the depths of the recession that helps new businesses incorporate, and
offers other advice, at no charge.
Already close
to 100 companies have launched through the initiative since it began in 2010,
including accounting businesses, two breweries, bakeries, a winery,
consulting firms and a farm.
The new
business owners walking through the law firm's doors are "not just the
young people -- it's middle-aged people, it's people
who have been outsourced, it's people who have been retired who want to go
into business," said Steve Cohen, chair of the mergers and acquisitions
team at Devine and a co-founder of the initiative. "The stereotypical
new business owner -- there's no such thing."
It's an
historical fact that recessions drive entrepreneurship, and the Great
Recession was no different. A 2010 study by the Kauffman Index of
Entrepreneurial Activity found that in 2009, entrepreneurial activity in the
United States grew to its highest level in 14 years, with 558,000 new
businesses created each month on average.
As a lawyer,
Cohen has seen firsthand the effect that recessions have on entrepreneurship,
having incorporated many businesses during the early 1990s recession and
after the dot-com bust.
But, he
realized, the Great Recession was different from previous recessions. This
time around, people had little or no equity in their homes, had little to
borrow against in dried-up 401(k)s, and banks
weren't lending.
"For
setting up businesses, whether they be corporations or LLCs, we looked at,
what's the impediment? It's cash," said Cohen.
"And who wants to spend the money to incorporate as opposed to buying
inventory or putting a deposit down on a lease or actually getting into
business?"
Any others
worth mentioning?
Michael J. Panzner
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