In a development that won’t surprise many people, economists say that the job-creating proposals produced by Obama’s “Rural Jobs Council” won’t be effective at reducing unemployment. In a speech yesterday, Obama unveiled his “rural jobs plan,” which includes expanding job training, increasing loan access for small businesses, and helping rural hospitals recruit new physicians.
But economists told ABC News that the proposals will have a negligible impact and could simply end up shifting jobs from urban areas to rural areas. Because there are fewer consumers in rural communities, this could actually end up creating lower revenues and fewer jobs:
If this rural physician is displaced from an urban or suburban area, Bronars said there may be one fewer physician in urban and suburban areas, which could lead to less revenue and fewer jobs where the physician would have otherwise been placed.
“The net impact of this program on jobs must account for both the increase in health services provided in the rural communities and the decrease in services provided in other areas,” which will likely lead to lower job creation numbers, Bronars said.
Phillip Swagel, former assistant secretary for economic policy at the Treasury Department, told ABC News that Obama’s plan is “akin to putting a new ribbon on last year’s birthday present and using it as a gift again” — which is a pretty apt comparison. The proposals may end giving the appearance of job creation in rural communities, while producing no overall increase in the number of workers.
