Obama to push corporate America to increase hiring
President Obama is looking for a little help from corporate America.
With unemployment still bedeviling the economic recovery, the president hopes to encourage major companies to use some of their bountiful cash reserves to hire more workers. He’ll make the case Wednesday, when top executives from companies including Google Inc. and Cisco Systems Inc. will meet with Obama at the White House, aides to the president said.
“I think there are a series of issues that are important to the business community that are important to getting our economy moving again, and I think those are issues that the president’s eager to work on,” White House Press Secretary Robert Gibbs said Monday.
Such meetings are largely symbolic but can help raise awareness among business leaders of what the country needs to increase economic growth, said Chris Rupkey, chief financial economist for Bank of Tokyo-Mitsubishi.
And given improving economic signals and some more business-friendly policies emanating from Washington, that might be enough to convince executives to start spending, he said.
“They’re probably right at the point where they’re getting ready to make additional expenditures on equipment and hiring additional staff, and this might be the final thing it takes to release some of those animal spirits on the part of corporations and get them spending again,” Rupkey said.
The Federal Reserve estimates that U.S. companies are sitting on nearly $2 trillion in cash. Spending some of that on hiring could make a dent in the unemployment rate, now at 9.8%.
The Obama administration has had a cool relationship with business generally, but in recent weeks it has taken steps that could warm things up a bit. It has completed a trade deal with South Korea and negotiated a compromise with congressional Republican leaders to extend all the Bush-era tax cuts, a deal that includes other provisions favorable to businesses.
Obama is even working with the U.S. Chamber of Commerce, one of his most ardent critics leading up to the November elections, to arrange a date next month for him to address the group.
Thomas Donohue, president of the chamber, commended Obama last week for the tax cut deal and for his outreach.
“All of our differences have been on policy issues. None of them have been personal, on this side of the street for sure,” Donohue, whose office is across the street from the White House, told Fox News.
“What we are interested in now is to keep moving out of this recession, put Americans back to work and put the recession behind us so that we can begin to build jobs all over this country,” he said.
The tax-cut deal should make the reception Obama gets at Wednesday’s meeting much friendlier, Rupkey said.
“I bet the CEOs tell him that was a great first step,” he said. “And maybe they do loosen the purse strings a little more.”
White House spokesman Gibbs said Obama had met with corporate leaders at “fairly regular intervals.”
Among those the gatherings have been meetings of Obama’s Economic Recovery Advisory Board, a group of business heads, labor leaders, economists and former government officials.
The advisory board is chaired by former Federal Reserve Chairman Paul Volcker. Its members include General Electric Co. Chief Executive Jeffrey Immelt and former Caterpillar Inc. Chief Executive Charles E. Phillips Jr.
Last week, Treasury Secretary Timothy F. Geithner met with business leaders at the Treasury Department to discuss the state of the economy, unemployment and efforts to make U.S. companies more competitive. That followed a meeting last month with the U.S. Chamber of Commerce’s board of directors.