BLOGNAME: LOUDER THAN WORDSAn informal, stream-of-consciousness reflection on business ideas, events and issues in modern business, modern life and with some specifics to the web-software industry by Paul Tomori, Internet Entrepreneur
|Who Creates Jobs?|
By Paul Tomori
Wednesday, August 31, 2011 at 11:05:36 (EDT)
All this talk about President Obama needing to create jobs... or here in Canada about Harper's government creating jobs... is nuts.
I heard an ad on the radio yesterday from some consumer group that essentially was calling on the governments to "create damn jobs already".
Maybe I am out to lunch or maybe, it's because I am an entrepreneur, but in my view, governments don't create jobs at least not for the general public. The only jobs that government would create are administration jobs, and these should be made fewer, not more numerous.
What is a job, really? It's someone doing something to generate a product or a service that holds inherent value to someone else. Entrepreneurs are simply people who recognize where a need must be met and they find a way to meet that need. If meeting the need requires them to hire people, then jobs are thus "created". And all that must happen afterward is that the people working those jobs deliver the value needed to keep the job viable. Of course, in a bearish economy, the buyers of goods and services diminish in numbers and this has a consequence. The need for jobs and workers gets reduced. How is government supposed to create jobs under such circumstances?
I remember a story from one of my first employers. He had been hired to work under a government-funded project for a small industrial firm. He told me that the manager asked him to move a big pile of bricks from one area to another... then when he was done, he was told to move the pile back. He got paid for the work, but let's face it, nothing was accomplished and no real value was added to our world. He may have gotten paid, but that was no "job". It was a make-work task designed to get people looking busy so that the industry owner could justify taking the government funding. What a waste. The job didn't last and the company went bankrupt shortly after. Where no value is being generated, it's not employment, it's just a handout being called a job. It's completely unsustainable. If the owner of that industrial firm actually had to spend HIS own money or his shareholder's own money, you can bet those bricks never would have been moved an inch. Instead, the owner would have allocated his dollars to productive work and to something that might actually have sustained the employment long-term.
The best thing a government can do is to remove impediments for entrepreneurs, reduce tax burdens, and to disseminate a new philosophy to its people... that they are responsible for creating their own jobs and doing so simply requires them to get busy doing something that someone else will find valuable.
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