Misconception: The problem isn’t really that bad
At the time of writing, there were 3.2 million long-term unemployed in the U.S. accounting for 32.9 percent of the labor force. We mentioned earlier that this was historically high — even higher than peaks recorded following earlier economic crises — but the graph above should illustrate how high the current level of long-term unemployment actually is. The current levels of long-term unemployment, as well as the current mean duration of unemployment, are unprecedented. Over the past five years, more people have been unemployed for longer than at any other point in the past half century. Not since the Great Depression has chronic joblessness been such a severe problem in the U.S.
The damage associated with this joblessness is enormous. According to the Urban Institute, “Being out of work for six months or more is associated with lower well-being among the long-term unemployed, their families, and their communities. Each week out of work means more lost income. The long-term unemployed also tend to earn less once they find new jobs. They tend to be in poorer health and have children with worse academic performance than similar workers who avoided unemployment. Communities with a higher share of long-term unemployed workers also tend to have higher rates of crime and violence.” This is a recipe for an economic death spiral.
Chosen excerpts by Job Market Monitor. Read the whole story at 3 Common Misconceptions About Long-Term Unemployment – Part 2.
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