–US Tsy: Firms Hired 4.5 Mln Eligible Workers Under HIRE Act

WASHINGTON (MNI) – The following is the text of a Treasury
statement on hiring under the HIRE Act and the tax benefits available to
businesses that participated:

Those Businesses Are Now Eligible to Receive up to a Projected $8.5
Billion in HIRE Act Tax Exemptions and Credits for Hiring Unemployed
Americans

SANFORD, NC – The U.S. Department of the Treasury today released a
new report showing that, from February 2010 to May 2010, businesses have
hired an estimated 4.5 million new workers who had been unemployed for
eight weeks or longer, making those businesses eligible to receive up to
a projected $8.5 billion in HIRE Act tax exemptions and credits for
hiring the unemployed.

Alan B. Krueger, Assistant Secretary for Economic Policy and Chief
Economist at the Treasury Department, announced the release of the
report in Sanford, North Carolina with Congressman Bob Etheridge (NC-2)
and Andy Warlick, President and CEO of Parkdale Mills, a yarn
manufacturer that recently reopened a plant in Sanford and has already
hired more than 30 workers who are eligible for HIRE Act tax exemptions,
a number that will likely grow as they continue to add more workers.

“Helping unemployed Americans get back to work – particularly the
long-term unemployed – is essential to ensuring a strong economic
recovery,” said Assistant Secretary Krueger. “Targeted, temporary
incentives like the HIRE Act are helping to fuel a private-sector-led
recovery. After a period of extraordinary difficulty, the economy is
continuing to grow and private sector companies have added jobs for six
straight months.”

The Hiring Incentives to Restore Employment (HIRE) Act of 2010
provides employers an incentive to hire workers who have been unemployed
for 60 days or longer by exempting wages paid to these workers from the
employer’s 6.2 percent share of Social Security payroll taxes for the
remainder of the year. In addition to exempting employers from these
payroll taxes, the HIRE Act allows employers to claim a tax credit of up
to $1,000 for each newly hired qualifying worker who is retained for one
year. An employer is eligible to receive almost $3,500 in tax savings
from hiring an unemployed worker who is paid $40,000 in salary this
year.

“This new tax credit provided a powerful incentive to grow our
business and was a major factor in our decision to re-open the plant in
Sanford,” said Andy Warlick, President and CEO of Parkdale Mills. “It’s
an example of tax policy that’s done the right way – that’s not about
off-shoring but about re-shoring, and it’s helping us create jobs here.”

Using monthly data from the Current Population Survey, Treasury
estimated that, from February 2010 to May 2010, 4.5 million workers who
had been unemployed for eight weeks or longer were hired by employers
who are eligible for the HIRE Act payroll tax exemption. If these 4.5
million newly hired employees remain employed for the rest of the year,
their employers would be eligible for an estimated $5.1 billion in
payroll tax savings as a result of the Act. Furthermore, if
three-quarters of the workers remain employed for 52 weeks, then their
employers would receive another $3.4 billion in tax credits for these
hires.

Treasury’s report includes employment data through May 2010. The
HIRE Act tax exemption is still available for the remainder of 2010 to
employers who hire unemployed workers. Treasury’s Office of Economic
Policy will estimate the number of newly hired workers whose employers
qualify for the HIRE Act tax exemption and update this report monthly
for the rest of the year.

** Market News International Washington Bureau: 202-371-2121 **

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