For President Obama, putting America back to work is Job No. 1.
With last week’s dismal jobs report and the presidential election less than 18 months away, the Administration’s mission has gained increased intensity. The Labor Department reported that the national unemployment rate jumped from 9% in April to 9.1% in May and the economy added a measly 54,000 jobs, the fewest in eight months. Joblessness among African Americans was particularly grim, reaching a crisis level especially when compared with the employment status of White Americans. The Black unemployment rate for May was 16.2%, up from 15.5% the same period last year, compared to an unemployment rate for Whites of 8%, down from 8.8% a year earlier. The jobs report indicated that the gears of the U.S. economy has stalled, slowing due to high gas prices and natural disasters in Japan that have hurt U.S. manufacturers.
It is evident that Obama has lost the bin Laden bump he gained a few weeks ago as the public, politicians and pundits focus on economic matters. As expected, Republicans couldn’t wait to pounce on the domestic policies of the president, who characterized the recent employment numbers as “a bump in the road” toward economic recovery in his weekly address. GOP presidential hopefuls like former Minnesota Gov. Tim Pawlenty sought to pound the president with the poor jobs numbers and his analysis, saying it “demonstrates President Obama’s failure to address the tough challenges we face as a nation.” Austan Goolsbee, chairman of the president’s Council of Economic Advisers, countered such rhetoric with stats that the private sector created 83,000 jobs in May and 2 million over the past 18 months. His vigorous commentary lost steam with the ill-timed announcement of his resignation on Monday to return to the University of Chicago.
Further challenges face as the White House continues high-stakes negotiations with GOP lawmakers to raise the federal debt ceiling by the Aug. 2 deadline. Some economists warn that adoption of the republican’s austerity plan would wreck Obama’s stimulus measures that have helped stabilize the economy as well as introduce the possibility of a double-dip recession.
So what should the president do?
Obviously, Obama must continue to hit the road and share his administration’s job creation programs. Hands down, he’s the best salesman for his agenda. In his weekly address, the president cited the turnaround of the American automotive industry, a sector saved by his bold, swift action when he entered the Oval Office. Bailed out by the administration, once-moribund GM went public this year and Chrysler–expected to return to private ownership soon–has, Obama asserts, “repaid every dime and more of what it owes American taxpayers…six years ahead of schedule.” He praised the automakers for “adding shifts and creating jobs at the strongest rate since the 1990s.” This success is an important part of his jobs message.
The president will continue to advocate for government support to retool the manufacturing industry, which lost 5,000 jobs in May. He views it as vital component to his “Win The Future” inititative. During Wednesday’s jobs speech at Northern Virginia Community College, he announced that the National Association of Manufacturers has agreed to grant industry-accepted credentials to 500,000 community college graduates as a part of a project to train students for 21st century positions.Colleges and universities are valuable tools in this effort. To address Black unemployment, the editors of BLACK ENTERPRISE suggested that the president include greater involvement from HBCUs to prepare individuals for skill-based employment and jobs for the next economy. It was one of a number of such recommendations that we made to the administration during our 20/20 Vision Economic Summit last year.
Obama must be aggressive in using his bully pulpit to develop more public-private partnerships as well as creative ideas from business roundtables such as his President’s Council on Jobs and Competitiveness, designed earlier this year as a source of non-partisan advice on strengthening the economy. The Council is chaired by Jeffrey Immelt, the Chairman and CEO of GE, one of the nation’s largest companies. We eagerly await the initiatives that will come out of the Council’s June 20th brainstorming session at the New York Forum, featuring White House Senior Adviser Valerie Jarrett, AOL founder Steve Case, Comcast Chairman and CEO Brian Roberts and Chairman and UBS Americas Chairman Robert Wolf.
At the top of the administration’s agenda is the fortification of small business, which produces the lion’s share of jobs throughout the nation. The White House appropriately convened this week the Urban Entrepreneurship Summit in Newark, New Jersey, a day-long conference aimed to assist minority small business owners by assembling government officials, private and non-profit financiers and leading entrepreneurs. I agree with the conclusion of Black Enterprise Senior VP/Editor-At-Large Alfred Edmond, Jr., my colleague who participated on the program: The administration must encourage state and local government to step up their role in job creation and business development. For example, Mayor Cory Booker should remake Newark into a catalyst for northern entrepreneurship by directing Fortune 500 companies to urban areas. Booker maintained at the conference that his administration’s Brick City Development Corporation has given out nearly $14 million in loans and, in turn, produced 42 women- and minority-owned area businesses. The hub initiative, however, would further Booker’s mandate to attract tech companies and support strategic partnerships.
The key to revitalizing small business–most notably, African American entrepreneurship–is access to capital. Despite a series of incentives and measures to encourage community banks to finance small companies, a large number still are wary of lending to start-ups as well as established firms. As part of last year’s 20/20 Vision Summit, BLACK ENTERPRISE made another recommendation that was popular with some policymakers: the Obama
Administration construct a FEMA-like apparatus for small business, a direct lending facility for established minority companies as well as oversee incubators for the next generation entrepreneurs. Other recommendations: streamline certification process in government procurement; ensure greater unbundling of government contracts; and establish a new GI Bill to expand employment and entrepreneurial opportunities for military veterans.From foreign policy to domestic affairs, Obama has become known for his pragmatic and Socratic problem-solving skills. One of his rituals has been to gather a brain trust of advisers from the private and public sector and challenging them to conjure up creative policy initiatives–a colleague of mine refers to these as “chaos sessions.” That’s the process he so brilliantly used to save the American auto industry and financial sector to cite two examples. To significantly reduce unemployment will require the most brilliant minds from business, labor, academia and finance and fully inclusive of African American and other minority leaders in those respective fields.
A recent news item reported there has been no American president since FDR that has won a second term in office with an unemployment rate above 7.3%. With less than a year and a half before the next election, Obama will need to gain more imaginative ideas and execute bolder actions in a time frame the president often refers to as “the urgency of now.”