Growing Businesses Cut Payrolls, Too

The recession of 2008-2009 has caused people and businesses to invest less and spend less. Although the recession is over, the United States has not fully recovered. The lack of consumer spending has caused business owners to have to cut salaries, lay people off, and stop hiring more employees.

Despite the downfall of the economy, consumer spending on mobile connections has increased by 15 percent. From 2005 to 2007, employment grew from six percent in the wireless telecommunication industry. By 2010, employment fell 14 percent. Similar statistics to the telecommunication industry are seen in other industries and businesses as well. Most businesses drastically cut employees after the recession, even if they were financially stable. Mulligan believes that the reason for the employment decline is because people face financial incentives. These incentives encourage employees not to work and it encourages employers to not hire employees. This is the reason for the lack of jobs available in the US.


http://economix.blogs.nytimes.com/2011/10/12/growing-businesses-cut-payrolls-too/?ref=economy