Presidential elections – particularly when an incumbent wins a second term — typically provide companies and organizations one thing they crave as they assess future investment and hiring plans: A respite from political uncertainty.
Yet 2012 is not your typical year. While the re-election of Barack Obama likely rules out any radical departure from policies of the last four years, adding complexity to assessing the post-election landscape for job growth and hiring is the very ominous “fiscal cliff.”
Economists warn that fiscal cliff — the blend of tax hikes and spending cuts set to go into effect in January — could slow growth, dampen hiring, and even push the economy back into recession if lawmakers do not hammer out a compromise. The fiscal cliff complicates any analysis of how a second Obama term will likely impact job growth and hiring moving forward. Some companies have already reported they are cutting back on spending and delaying hiring until there is more clarity.
The fiscal cliff is term used to describe the dilemma the U.S. government faces at the end of 2012, when the terms of the Budget Control Act of 2011 are scheduled to go into effect. Among the changes set to go into effect at midnight on December 31, 2012 if lawmakers don’t act:
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