Dec. 4, 2009 -- The U.S. economy got some very good and surprising news this morning: only 11,000 jobs were lost in November, a number much, much smaller than expected and a sign that the job market might have finally turned a corner.
More people are still unemployed than a month ago but the monthly losses were the smallest since December 2007 and Wall Street reacted favorably, with all major indexes shooting up in pre-market trading.
The unemployment rate also fell to 10 percent in November from 10.2 percent in October, thanks to government revisions to prior months' job losses. Economists had expected a loss of 125,000 jobs last month.
The Treasury Department's chief economist, Alan Krueger, said the news was "welcome" but cautioned that unemployment still remains "unacceptably high."
"We shouldn't put too much weight in one month's data," Krueger said at a briefing following the release of the November numbers. "Recoveries don't move in straight lines, although the overall trend continues to be improvements in the job market."
Investors, however, were quick to wonder if the showing is just a fluke month and how the nation can continue to improve the economy.
The White House yesterday sponsored a "Jobs and Economic Growth Forum" that, at minimum, sparked an important dialogue about finding some way to stem job losses that have caused the worst unemployment rate in nearly 30 years.
Now comes the hard part -- turning ideas into action.
So where to start?
As President Obama and his gathering of economists and business leaders brainstormed in Washington, D.C., ABCNews.com interviewed a wide range of economic policy experts, academics, lawmakers, investors and other public figures to get some perspective on the kinds of meaningful job creation steps that can, and should, be taken immediately:
Extend Bush Tax Cuts
At least until unemployment drops below 6 percent, says House Minority Whip Eric Cantor, R-Va., passing an extension to about-to-expire Bush era tax breaks will help small business owners keep more of their profits, and represents a "straightforward, common-sense solution that the president can put into place now."
Widen the TARP
With the financial system seemingly stabilizing and a sizable chunk of TARP funds as yet unused, a number of politicians are angling to tap into that money for projects beyond the scope of shoring up bank balance sheets. Using TARP money – there is nearly $210 billion as yet uncommitted and Bank of America has said it intends to pay back $45 billion more – some say, for infrastructural improvements (road and bridge repairs). House Speaker Nancy Pelosi, D-Calif., suggested today a national high-speed rail project should be put on the front burner.
Meanwhile, a number of decaying cities could use more direct federal funding for initiatives such as environmental cleanup projects or wholesale transformations of former industrial sites. One such project, in Buffalo, N.Y., recently created 400 or so new jobs. "The EPA has a $250,000 cap on funding for individual cleanup projects," explained Byron Brown, mayor of Buffalo, and who is among a handful of local mayors and civic leaders set to host follow-up job summits next week. "One thing that can easily be done right now is to remove the cap or raise it significantly." Brown advocates funneling TARP money to agencies such as the EPA, as well as directly to cities such as Buffalo to be used for things like urban redevelopment and historic preservation projects.
Boost Unemployment Benefits
Congress just passed another round of unemployment benefits extensions last month – extending them by 20 weeks in states hardest hit by the economic downturn and by 14 weeks everywhere else – yet, some policy watchers are calling for even further extensions.
Gus Faucher, the director of macroeconomics at Moody's Economy.com, notes that the latest extension won't cover people who lose their jobs in 2010. As a result, they will be stuck with traditional benefit limits. Providing more people with more unemployment insurance, he said, will keep them spending – an important facet of economic recovery and more job growth. "We are seeing consumer spending start to improve," Faucher said. "If that continues, we will see job growth in industries like retail, food service, transportation, distribution and wholesaling." Unemployment checks aren't going to turn the economic tide, but as Faucher points out, "if people don't have that money, they won't be spending anything."
Create More Wind Farms
Look no further than the flatlands of West Texas when wrestling with the jobs creation question. For the answer there may be blowing in the wind. From building a new power delivery infrastructure and grids, to the manufacturing of wind turbines, there are plenty of opportunities to create jobs within the wind power industry and clearing its path should be high priority, says billionaire entrepreneur Sam Wyly. "If other states followed the lead of Texas, especially in the middle of the country, here is an industry where literally the sky is the limit," noted Wyly, the Dallas-based founder of Green Mountain Energy and the author of "$1,000 Dollars and an Idea" (Newmarket Press). Wyly, a pal of alternative energy proponent and fellow Texas tycoon T. Boone Pickens, is a major supporter of tax incentives for wind energy companies and for a federal program to secure land rights for wind farms.
Fork Over the Food Stamps
The liberal leaning Economic Policy Institute advocates for more spending on government "safety net" programs, such as food stamps. But exactly how does helping people buy more food help the country gain more jobs?
EPI labor economist Heidi Shierholz said that, as with unemployment insurance extension, providing Americans the means with which to buy more groceries will help stimulate consumer spending.
"That money is immediately spent on the local economy on food," she said. "If that person that receives that food stamp is then buying something that they wouldn't be able to buy otherwise, that saves the job of the checkout person who works at the grocery store they went to. That person has wages to spend on their necessities."
It's what economists calls the "multiplier" or "respending" effect, Shierholz said.
Target Aid to States
Under the Obama administration's stimulus package, states received some $50 billion to ward off layoffs, mainly at schools. But even with that aid, some states are still having trouble making ends meet this year, and Faucher worries about what will happen next year.
He and others argue that states -- which unlike the federal government, can't go into debt to balance their budgets -- should receive more money to tide them through their fiscal hardships.
"State and local governments are required to balance their budgets. If they have big budget deficits, they need to lay people off," Faucher said. "If someone who would have been laid off keeps his or her job, that's just as good as adding the new job."
Increase Relief for Small Businesses
Experts agree that small businesses are a major driver of jobs growth in the U.S., but with many small businesses still struggling to obtain loans from banks, some argue that the government should be doing more to increase credit to small businesses beyond recent measures to make more TARP money available to community banks.
Cheryl Carleton, a labor economist and a professor at the Villanova School of Business, said the government should make loans directly to businesses, or the Federal Reserve should pressure banks to be less risk-averse when it comes to deciding whether to grant loans to small businesses.
"The Fed has to use its clout," Carleton said.
Faucher said the government could expand the Small Business Administration's loan guarantee program – which insures 90 percent of a bank's loan to a small business – to a guarantee rate of 95 percent. Those extra five percentage points, Faucher said, can make a difference.
"Given how tight credit is, and how reluctant banks are to lend, I think it could help," he said.
Tie Tax Credits to Hiring
How do you convince a business to expand its payrolls? How about offering them a tax credit for each new hire? It's an idea making the rounds now, and it's got the support of EPI's Shierholz.
"It's a really smart way to do business tax credits," she said.
She conceded that some credits will go toward businesses that would have hired new employees even without the tax incentive. But given the current unemployment situation, she said, it's still worth it.
"It really is time to take big, bold action," she said.
Tackle Health Care
Carleton won't play favorites when it comes to the various versions of health care reform churning through Capitol Hill. But when it comes to job creation, she said any health care reform package must do at least one thing: lower health care costs for businesses, particularly small businesses who don't qualify for reduced rates available to larger companies.
Carleton said that health care costs are a major reason companies may opt to have employees work overtime instead of making new hires to take on extra work.
"If you want them to hire more workers," she said, "you have to reduce the cost of hiring new workers."
"The government needs to accept the simple reality that it can't create jobs," pointed out former Minnesota Gov. Jesse Ventura. "What it can do is make things easier for the private sector and business community to do what they need to do – this is the only source of job creation that we can count on. Get out of the way and let businessmen lead."
Addressing job growth concerns in the U.S. is simply a matter of time and patience, some say. "What little the government can do in the short term, it has already done," New York University economics professor Roy Smith said. "The government needs to be respectful of its own limitations."
ABCNews' MATTHEW JAFFE CONTRIBUTED TO THIS REPORT