Reply #6: the motivation for a payroll tax cut is to help people, not to create jobs

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it's to get money into the hands of people who need it and are likely to spend it.

it goes to people who are doing the "right thing" (working) yet adversely affected by those who did the "wrong thing" (screwed the economy), and it helps reduce household debt and stimulate demand, which are the real underlying problems in the economy.

it does help with job creation in the sense that additional demand will drive more production and therefore more job creation.

it also very slightly makes hiring someone more efficient in that more of the employer's expenses actually reach the employee (same employer outlay means more take-home pay for the employee), so in theory an employer might be more likely to hire, but this effect is so tiny it has be be considered theoretical only.


mostly politicians talk about this as "job creation" because it has something to do with jobs and they need to be seen as addressing the "jobs creation" issue.