On March 4th, the House passed the Hiring Incentives to Restore Employment (HIRE) Act by a vote of 217-201 to encourage employers to hire workers who were previously unemployed or only working part time. The President signed the legislation into law on March 18th. The bill provides:
A payroll tax holiday for businesses that hire unemployed workers, to create some 300,000 jobs and an income tax credit of $1,000 for businesses that retain these employees
Tax cuts to spur new investment by small businesses to help them expand and hire more workers
Extension of the Highway Trust Fund allowing for tens of billions of dollars in infrastructure investment
Provisions–modeled after the Build America Bonds program–to make it easier for states to borrow for infrastructure projects, such as school construction and energy projects
Today, the U.S. Treasury Department released a new report showing that from February to May 2010, American businesses have hired an estimated 4.5 million new workers–each of whom has been unemployed for eight weeks or longer–and are eligible for tax exemptions and credits Congress approved earlier this year to put Americans back to work. Those businesses are now eligible to receive up to $8.5 billion in HIRE Act tax exemptions and credits.
If these workers remain on the job for the rest of the year, their employers would be eligible for an estimated $5.1 billion in payroll tax savings under HIRE Act. If three quarters of the newly hired workers remain employed for 52 weeks, then their employers would receive another $3.4 billion in tax credits.