As unemployment continues to rise, and hopes of the trickle-down factor from economic stimulus bill are dwindling, I am working to find solutions that will directly help East Tennessee. Just like many industries across the nation, our businesses in small towns are being forced to downsize operations while demanding more from fewer employees. Even in the current economic downturn, workers in smaller remote communities are at a disadvantage because economic development is virtually non-existent. In fact, a growing number of rural workers are forced to commute long distances or actually relocate their families in order to find work in metropolitan areas. Ultimately, this only creates a worsening downward spiral.

That is why this week I am introducing the Economic Stimulus for Rural Communities Act in an effort to spur the economy and create quality jobs in rural America. In East Tennessee and across the nation, rural areas are often times hit harder during an economic downturn and they often lag in a recovery. This legislation would make rural employers eligible for a tax credit when they hire a rural worker.

A recent article in the New York Times reported that, “Tax credits for companies that create new jobs is gaining support among economists,” due to the highest unemployment numbers seen in this generation.

According to the U.S. Department of Agriculture’s Economic Research Service, 

    “As the number of jobs in nonmetro areas fell, the nonmetro unemployment rate rose to 9.2 percent in the second quarter of 2009, up from 5.2 percent a year earlier. This was the highest second-quarter nonmetro unemployment rate since 1983 and the largest second-quarter percentage-point increase since the beginning of the ERS data series in 1973. 

    “The largest increases in both metro and nonmetro unemployment rates since mid-2008 have occurred in the Southeast, the Great Lakes region of the Midwest, and the Pacific Northwest. 

    “Increases in the Midwest and Southeast were accompanied by declines in automobile and related manufacturing employment between the second quarters of 2008 and 2009.”

This economic stimulus bill for rural communities expands the Work Opportunity Tax Credit (WOTC) and gives companies, small and large, an incentive to locate and expand their business to rural areas and hire rural residents. Under this bill, an employer would be eligible to receive a tax credit, generally 40% of the first $6,000 in wages, for every job added in a rural area. The definition of “rural” would be determined by the Secretary of Agriculture.

Even when the U.S. economy was growing, many rural Americans were struggling in their local economy. As the American economy has slowed and national unemployment is almost 10 percent, this problem has only worsened. I introduced this economic stimulus bill in an effort to get more jobs into Tennessee’s First District and other rural areas across America. I believe this initiative will help our rural communities and I believe it could be a part of a larger effort to create jobs in our economy.

Last week, we held the official Grand Opening event for our new office location in Kingsport, located in the Higher Education building on 205 Revere Street. I want to thank everyone who was able to attend.