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When do businesses hire people?

Do they hire when they have more money in their pockets...or when they need additional help in operating the in's and out's of their business?

The proponents of trickle-down economics don't seem to realize one important fact: Business owners don't hire people just because they have money in their pockets. They hire people because they need additional help handling their customers. The way to increase jobs is to increase customers, and the best way to increase customers is to keep money in the pockets of the lower and middle class, the groups that spend most of their income.

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  • Anonymous
    10 years ago
    Favorite Answer

    Businesses hire people when they see a market that they need to staff up for.

    No matter how much money is in the pocket of investors or business owners, if they don't see customers down the road, they don't invest in new employees.

  • 10 years ago

    They hire general workers for different reasons than they hire new managers and middle men. Many companies have been restructuring and in that process often the general labor, especially people who supply administrative support are being sacrificed at this point for those higher paid new additions by a margin of about 50 to 10 in a medium sized company. They use new computer systems to replace them or just pile twice the work on those who are left.

    These companies are often using temporary contracted labor rather than hiring permanent employees because they still do not know how the health care bill, new financial reforms, and emissions controls will effect their bottom lines. They don't even know what their tax rate will be or if they will lose their deductions for buying new machinery, etc. They are saving their pennies for a rainy day and most are holding off on expansions due to this uncertainty.

    Evidently you think there is more pride in keeping people in the dole than in them having a job where they get trickled on. Give me a job any day. I swear I will never understand that concept. That sounds like people are just too damn good to work so they sit on the butts collecting checks. They would rather be at the mercy of the government than work for a living. I really don't believe most people feel that way.

  • 10 years ago

    Putting money in the hands of the lower and middle class with tax breaks encourages consumer spending on imported goods and increases debt. Margaret Thatcher tried that policy and it failed because the money was spent on imported consumer goods rather than domestic goods. The US has a $273 billion trade deficit with China.

    http://www.uschina.org/statistics/tradetable.html

    Rather than handing out happy money to the lower and middle class, give targeted tax credits for business to invest in equipment that increases productivity with the objective of recapturing $273 billion of domestic market share. Local business will hire more people to satisfy the increased demand and employment income for the lower and middle class will rise as a result.

    Source(s): business owner
  • 10 years ago

    you appear to believe that poor and middle class get paid for existing...some rich guy or company hires a person to do a job and the resulting spending is really not relevant. When was the last time a poor person hired someone with their own money?

    You can try to blame the rich for the country's ails...but look at the voters!

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  • Anonymous
    10 years ago

    Demand for product!

    Demand for product!

    Demand for product!

    Companies need to sell product or service to make income.

    Companies need income to make profit.

    Income comes from customers.

    Companies needs employees.

    They pay the employees, which become customers.

    The more employees, the more customers, the more income.

    However when all of the employees are overseas... the company runs out of customers.

    Of course the company can sell their stuff overseas to the overseas employees.

    But... that does not help our economy.

  • 10 years ago

    When they are reasonably confident that their committment to hiring employees today will result in a profitable outcome 1-3 years out AND there is very little downside risk of being overcommitted in terms of costs and liabilities of having hired more employees.

    If the government imposes penalties attached to corporate responsibilities of providing healthcare to employers OR providing risk mitigation to consumers, they hedge and wait out while they see how it works out.

  • 10 years ago

    When demand for company product increases to the point they need more people to meet demand .

  • Anonymous
    5 years ago

    By taxing them into oblivion then expanding government so much that all the recent layoffs can get government jobs. Well, at least that's how it was supposed to work.

  • 10 years ago

    I got hired because some dude was retiring, we are finding out now, he didnt do much

  • Anonymous
    10 years ago

    Trickle down works - the only problem is that what trickles down is yellow and brown.

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