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A Growing Underclass
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by snuffysmith | January 15, 2010 at 06:33 am
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A Growing Underclass By CATHERINE RAMPELL
Slowly but surely, longer-term unemployment seems to be becoming the norm.
While layoffs are slowing, the number of job openings relative to the unemployed population were still at a record low in November.
That means that those who have already been laid off must spend longer and longer periods looking for work. Take a look at the make-up of the unemployed last month, compared with a year earlier:
In December 2008, 22.9 percent of the unemployed had been out of work for at least 27 weeks. A year later, that portion rose to 39.8 percent. That translates to having about 4 percent of the total civilian work force categorized as long-term unemployed.
Here’s a look at how many weeks the average jobless person has been jobless for:
Source: Bureau of Labor Statistics
It is clear from these graphs that the Stimulus did little to alleviate the unemployement and layoffs picture in the US economy.
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The average person who was unemployed in December had been out of work for 29.1 weeks. By contrast, when the recession began two years earlier, the average unemployed person had been out of work for 16.5 weeks.
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In short, the length of time the average person who has been layed off or who is unemployed, has doubled in two years.
The practice of not counting those who have been unemployed longer than six months began long ago, at least during the Bush Administration. Consequently, these numbers understate the true number of unemployed people in the US. They do not include anyone who has lost their jobs longer than six months, last year, five years ago etc. and who have not been able to find work anywhere and thus have most likely dropped out of the labor force altogether after months of discouraging job searches.
Also not working, although helping to alleviate the layoff picture, are the safety-net programs like unemployment benefits designed to help individuals feed their families until new jobs are found. Some economists have argued that providing these benefits discourages hiring practices by employers especially in the construction trades.
Washington is now going to have to grapple with the problem of the growing pool of permanently unemployed workers.
These are bad trends. No green shoots in the labor market.
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at 12:15 on January 15th, 2010
Jobs, Jobs, Jobs
Howard Richman, Raymond Richman, and Jesse Richman
Where they have gone, why, and what we can do about it. More