Businesses score tax credits for hiring 4.5 million

By Tami Luhby, senior writer


NEW YORK (CNNMoney.com) -- Businesses have hired an estimated 4.5 million Americans who have been jobless for at least eight weeks, making these firms eligible for approximately $8.5 billion in tax credits, according to a Treasury report released Monday.

The tax credits are part of the $13 billion Hiring Incentives to Restore Employment (HIRE) Act, which Congress passed in March.

Under the act, employers who hire workers who have been jobless for at least 60 days are exempt from the 6.2% payroll tax charged per worker -- for the rest year. In addition, companies can claim a tax credit of up to $1,000 for each employee who stays at least a year.

The administration released the report, which looked at the period from February through mid-May, in hopes of raising awareness about the credit.

The legislation is one of the few job measures that lawmakers have been able to approve this year. However, the measure's actual impact on hiring may be impossible to determine, said Alan Krueger, the Treasury Department's chief economist.

Some 12.2% of the unemployed were hired on a monthly basis after the act went into effect, up from an average of 11%. But Krueger said he wouldn't draw any inferences from that statistic.

"I would be cautious about attributing [additional hiring] to the HIRE Act," Krueger said.

The HIRE Act's goal is to incent companies that are considering adding to their payrolls to do so faster. The administration highlighted a North Carolina yarn manufacturer that has hired more than 30 workers eligible for the tax credit because its business is growing.

Industries that are expanding or have high turnover are more likely to take advantage of the credit, Krueger said. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 17,159.90 27.93 0.16%
Nasdaq 4,559.41 6.65 0.15%
S&P 500 2,002.16 3.18 0.16%
Treasuries 2.58 -0.01 -0.35%
Data as of 10:35am ET
Company Price Change % Change
Apple Inc 101.48 0.62 0.61%
Bank of America Corp... 16.79 0.08 0.48%
Yahoo! Inc 42.56 -0.15 -0.35%
Alcoa Inc 16.20 0.04 0.22%
Microsoft Corp 46.57 -0.19 -0.41%
Data as of 10:20am ET

Sections

Some Wal-Mart employees falsely told customers Coke was more expensive in New York because of a sugar tax. More

When will the Fed raise rates? It all depends on whether the phrase 'considerable time' is or isn't in the Fed's statement. More

Frederick Hutson launched Pigeon.ly in 2012 to help inmates communicate with their friends and family. He's on target for $1 million in sales this year. More

Occupy Wall Street offshoot Strike Debt says it has abolished nearly $4 million in private student loan debt for students who attended Everest College, part of Corinthian Colleges. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.