According to the Reuters article, Obama Signs $17.6 Billion Jobs Bill:
The legislation would exempt businesses from paying the 6.2 percent payroll tax on new employees who had previously been out of work. Employers would also get a $1,000 tax credit if those workers were still on the job a year later.
Here's how my tax professional explained it in his recent newsletter (reprinted here with his permission):
It's part of the HIRE Act, passed March 18. Employers normally "match" the 6.2% FICA tax on the first $106,800 paid to each employee. This year, employers who hire anyone who certifies he/she was not employed more than 40 hours in the 60-day period before hiring get a tax "holiday." Key rules: employee must be hired after February 3, can't replace another employee unless former left voluntarily or for cause, applies to wages between March 19, 2010 and end of year. IRS issued a revised Form W-11 for the hire to certify the unemployment, and is revising Form 941 to allow for the credit. In 2011 the law expires, but a credit of up to $1,000 can be earned for any qualified employee who is retained for at least 52 weeks.
Does this mean the active job seeker now has a leg up on the passive job seeker? Maybe... if the employer knows about and values this tax advantage.
So here's the big question: Which employers want unemployed job seekers and the corresponding tax advantage? I did some research, hoping to find a list of such employers, but no luck.
Then, I remembered stories about creative job search strategies that had actually worked, like the sandwich board resume, a clever YouTube resume, and the $6 Google ad campaign. Does the Jobs Bill open the door for another unconventional approach... like marketing your unemployment status as a tax benefit to a potential employer?
In other words, when approaching the right company, sell yourself as the ideal unemployed job candidate who's going to save the employer tax dollars. You could actually use the dreaded "unemployed" (or "available") word in your cover letter or email.
Now, this goes against the grain of most job search advice -- including mine. But it's creative! And it could possibly work -- at least the Obama Administration is hoping it will.
When to Say You're Unemployed
It might pay to state that you're unemployed if you:
- Try to get a job at a new or growing company. Is there a new plant or branch operation that's looking for new employees? Such a company might be open to hiring quality unemployed job seekers in order to get on board with the Jobs Bill tax incentives.
- Apply for a job in a struggling company. What companies are not thriving, and therefore might be looking for every way to save a dime -- even from Uncle Sam? Working for a struggling company probably doesn't fit with your image of job security, but it might be a place to park yourself for a spell.
- Find a job with a tax-savvy company. What companies are financially smart enough to understand the value of a good unemployed job candidate and the tax savings he or she brings along with the deal? Maybe a company in or related to financial services?
- Seek employment with a small business. What small business is open to your suggestion that they save on taxes by hiring you? This might mean taking the bold step of educating the employer -- very concisely -- in your cover letter.
If you take an "I'm unemployed" job search approach, I suggest you look busy on your resume by listing a current activity (professional development, volunteerism, or personal project) that's relevant to your job objective, even if you're not getting paid for it. You want the employer to see that you're relevant and involved in your profession, no matter what your employment status.
The Jobs Bill will expire at the end of this year. The clock is ticking! How can you take advantage of it in your job search? Let's brainstorm here in the Job Lounge and add ideas to this list.
For another idea for solving your unemployment, check out Barbara Safani's article, Unemployed Need Not Apply. Barbara suggests networking in your community where employers won't be put off by your unemployed status because they know and trust you.
And, for a lively discussion on whether it's fair for employers to prefer passive job seekers over active job seekers, read the Why isn't this illegal? discussion in the Job-Hunt Help Group on LinkedIn. You must be a member to access the group, but it's free to join.