Some LI businesses say tax break not a hiring incentive

Businesses nationwide  have added 4.5 million workers under a new program that provides tax incentives for hiring the unemployed, the Treasury Department said Monday.

The program, signed into law by President Barack Obama in March, exempts businesses that hire people who had been jobless for the 60 days before beginning work from paying the 6.2 percent Social Security payroll tax through December. Employers could also claim a $1,000 tax credit for each worker retained on the payroll for at least a year.

The new workers were added from February to May, according to the Treasury, and the businesses that hired them are expected to save $8.5 billion in taxes. However, the Treasury report did not estimate how many of those jobs would have been added anyway, without the tax break.

Several Long Island business owners say the tax break was not a strong incentive. They said they hire when demand for their goods and services makes adding workers profitable.

"Personally, it has not influenced my decision to hire," said Maryellen Ruvolo, of the East Islip-based company PharmStorm, which recruits employees for the pharmaceutical industry.

Jack Bloom, president of the printing company Sir Speedy in Westbury, said business had to pick up before he started to increase his staff. When things began to look up about two months ago, he hired a new salesman.

He later increased the hours of his press operator, and a graphic artist started at the company Monday. "In all honesty, I probably would have hired them [without the incentive] because we needed people," he said. "Business came."

Some said the incentive may have influenced the number of employees they chose to take on.

"Incentives might make you hire two instead of one, but it is not the determining factor," said Ted Bier, president of T.M. Bier & Associates, Inc., a Glen Cove-based control systems engineering company. Bier said two of the three employees hired since February would have been hired regardless of the tax incentive. "The third [hiring] may have been influenced by the incentive."

Trace Feinstein of E-Scrap Destruction, an Islandia-based electronics recycling company, said he decided to hire four new employees with the help of the incentive. Without the incentive, he doubted that he would have done so. "I would have to give it some serious thought," Feinstein said. "The incentive helped me make up my mind."

Sen. Charles Schumer (D-N.Y.) said he decided to ask for an extension of the program after hearing Monday's figure. "It will not solve problems for all businesses," Schumer said. However, "it has exceeded expectations."

Supplemented with reports from  The Associated Press.