As one top state labor person observed to me recently, most politicians have no clue about how labor markets work and they’d be hard-pressed, in many cases, to accurately describe the complete picture of what jobs are in their district. So, you see all this flailing about, trying to appear like they know where to direct stimulus money when most don’t.

  Here’s something that can work–because it has worked. The New York State Department of Labor has a proposal to the Feds that is pretty straightforward–give us $100 million and we will partner with business, mainly in the financial sector, to save 6,200 jobs. The program is called Targeted Employment Maintenance Program (TEMP) and the document was given to me by Bruce Herman, the state’s Deputy Commissioner for Workforce Development. Right after the September 11th 2001 attacks, a similar program saved jobs. Here are the deets:

The TEMP, administered by the NYSDOL, would provide partial wage payments directly to approved employers as an integral part of an aggressive layoff aversion strategy.  Businesses seeking assistance under this program would undergo a transparent review process to determine:

1. whether their business has been impacted by the financial crisis, either directly or secondarily, and 2) the amount of financial assistance to be provided by this program.  Criteria would be established for participation in the program including assurances that supported jobs meet certain standards.  Payments would only be authorized upon receipt of documentation from the business proving that covered employees have been paid their full wages (including any payroll taxes and any fringe related costs) in accordance with provisions of an agreement entered into and approved by the NYSDOL.  The statewide program will:

o Focus on small and medium sized businesses;  

o Specifically target primary and secondary workers (with earnings at or above the occupational average within their industry; and, not to exceed $30/hr).  Businesses who pay wages that are less than the occupational average for that industry will not be considered for participation in the program;

o Give priority to occupations that offer the highest potential for increased revenues and are most likely to contribute to the long term success and viability of the company; and, to those businesses who provide health insurance.

o Only cover up to 25% of a company’s workforce for up to six (6) months; any payments made under the program would be for up to 50% of an individual’s base hourly wage

o Require documentation (e.g., copies of payroll registers to prove hours paid for each worker) to support payments authorized under the program;

o Require businesses to retain the workers covered by the program on a full-time basis (minimum 30 hours per week) and agree not to reduce any regular benefits e.g., health insurance, etc.

o Provide a retention bonus for those impacted workers kept on the company’s payroll, without benefit of a partial wage payment, for 90 days past the initial six month partial wage payment period. The retention bonus will consist of an additional payment to the company of up to 1% of a covered individual’s annualized salary, not to exceed $624 per employee.

  The large point here is that you inject money quickly into the workforce to keep people working. That obviously helps workers. But, it also helps businesses, which can lose workers to a lay-off and, then, spend a lot of time and money trying to rehire people when the economy improves.

  True, the New York state program only for six months. But, that’s a key chunk of time that could help a lot of people weather the initial economic collapse and, perhaps, make it through to the other side. As the program outline points out,

"Workers benefit by sustaining their employment and fringe benefits, enabling them to meet their financial obligations for mortgages and other living expenses.  Unemployment benefits will only provide up to 50% of the workers’ earnings for a time-limited period and are capped at $405 weekly in New York.  There is no fringe benefit coverage.  Families deplete their savings to stay afloat and often fall behind in paying their bills.  A catastrophic health event can send an uninsured family spiraling into bankruptcy."

  So, I just extrapolated using the rough figure of $16,000 per worker (rounded up) from the New York State proposal. If we did this nationwide, we could keep one million people working at a cost of $16 billion (yes, this is rough so it’ might be a billion or so one way or the other–but with New York, a highly-unionized state, having average wages that are higher than some of the other, mainly Southern states, I’d guess that $16 billion isn’t too low).

  Anyway, just for peoples’ consideration. This seems like a pretty logical way to do things.