Employment and lack thereof remains a major concern for the government; rightly so. In response, it is initiating laws and bills to kick-start economic revival by way of employment. Legislation concerning job growth is underway, attempting to bolster job openings, hiring speed, and market confidence. Various bills that will inject over $50 billion are expected to progress the timeline for job growth, which in turn would lead to a more expansive step towards economic recovery.
In order to encourage employers to hire sooner rather than later, this new legislation offers a tax holiday to businesses that hire those individuals who have been unemployed for at least 60 days; an additional $1,000 tax credit will be applied to that hiring firm if the new employee continues to work for at least a year. Chiefly, these are government-issued gifts distributed to those business willing to participate in the hastening of an economic recovery, and meant to encourage otherwise hesitant participants to act accordingly.
There are a number of other bills in effect, whose purpose has been to ease the blow of unemployment by providing various benefits and health insurance subsidies, though they are approaching expiration very soon. A program that will be expanded instead of expiring is the Build America Bond Program, to which $7.6 billion will be added; this way, local governments can take on more construction projects and received subsidized funding from the program, thereby creating a considerable amount of construction jobs, which may in turn spark additional demand for apartments.
This definitely affects the real estate market. The expansion of jobs in the construction division will have a positive impact on apartment demand by attracting a migratory work-force that will fill up apartment units and ease vacancy rates. Job and hiring growth in general will expand rent demographics and allow the prime rent demographic of the New York City (20-35 years old) to afford asking rent prices. In order to properly and successfully address industrial vacancy rates, which currently stand at 12.6 percent nationwide, the government plans to increase private venture capital spending by allowing tax cuts for investors and small businesses; long term investments would receive an exemption from capital gains tax. It is the hope that increased venture capital spending will aid in the absorption of vacant industrial space.
What are you seeing out there? Are the conditions that the government is trying to alleviate with this legislation reflective of your local job and apartment markets?
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