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Innovation Isn't Holding Back Job Growth


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I know that President Obama wants to see job growth as much as anyone in Washington, but a recent comment displayed a lack of economic understanding: "There's some structural issues with our economy where a lot of businesses have learned to become much more efficient with a lot fewer workers. You see it when you go to a bank and you use an ATM, you don't go to a bank teller. Or you go to the airport, and you're using a kiosk instead of checking in at the gate."

New technologies can certainly be disruptive, but if the ATM can be blamed for today's recession, then why couldn't the Model T be blamed for the Great Depression?

Most new technologies increase efficiency in one way or another. The ATM was no exception, but the ATM did not actually replace bank tellers. In fact, the number of bank teller jobs in the U.S. has increased in the last ten years. According to the Bureau of Labor Statistics, there were 607,960 bank tellers in the U.S. in 2007. In 1985, there were only 485,000 tellers. From 1985 to 2007, the number of ATMs increased from around 60,000 to nearly 400,000.

The ATM is not an illustration of how automation takes away jobs. In fact, it almost perfectly illustrates how technological advancement makes our economy grow. U.S. companies like Diebold and NCR manufacture ATMs in the U.S., employing thousands of workers. The networking and maintenance of ATM machines also create jobs in the banking industry.

At the same time this technology directly creates jobs, it makes every bank-using American more efficient. Wait times at banks are dramatically decreased and consumers have access to their money when they want it, not when the bank is open.

The President's words this week concern me greatly. We are facing 9.1 percent unemployment. The average time the unemployed spend looking for a job has risen above 40 weeks. Many economists have downgraded their predictions for this year's economic growth. Our number one priority in Washington needs to be job growth.

But if the President does not understand how jobs are created, then Washington is going to continue to make life hard for job creators. This week, the President's chief of staff, Bill Daley, met with hundreds of manufacturing executives. According to the Washington Post, one executive stood up and said that the government, "Throws sand into the gears of progress."

Daley had to admit that the number of rules and regulations "that come out of agencies is overwhelming." He tried to point out that the Administration is working to identify rules for elimination. The problem, however, isn't just decades old rules that don't make much sense. New rules in pipeline will do incredible damage to American industries large and small.

The President's chief of staff is a former executive himself, but there is little that understanding and empathy can do when the bureaucratic machinery of Washington is spreading red tape across the country.

In the House of Representatives this year, we have passed nine major bills to help job growth. Two of these bills try to hold back a specific job-destroying regulation that the Obama administration is working on right now. Another one of these bills directs every Congressional committee to identify ways that Washington is holding back job growth and introduce bills to correct what is wrong with the bureaucracy.

Only one of these bills has been signed by the President: the legislation eliminating the burdensome 1099 tax mandate created in last year's health care law. Frankly, we need to do more than just stop government from taking actions that hurt employment. While the House has passed legislation to reduce energy prices, no similar bill has been considered by the Senate or proposed by the President.

The Small Business Optimism Index monitored by the National Federation of Independent Business has fallen for three straight months. When Americans are confident, they start new and innovative businesses. Washington is making it harder for job creators to come up with the next ATM or to manufacture it here in the U.S. We need leadership that recognizes that innovation is what drives the American economy, not what drives it into a ditch.

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