A Wall Street Journal reporter recently contacted me and wanted people's stories about being long-term unemployed. Below are some excerpts from a story he did yesterday about extending unemployment benefits (My notes are indented and highlighted)
(WSJ by Josh Mitchell) - Republicans say the extended benefits have gone on long enough—more than five years—and argue that the checks create a disincentive for people to find work.
Editor's Note: It's been cited in several studies here and here debunking the false cause and correlation claims about unemployment benefits being a cause of higher unemployment; or that extending federal jobless benefits also extends the duration of joblessness.
Many economists believe such aid boosts the unemployment rate, perhaps by as much as 1 percentage point. But they differ on the reasons and on the size of the effect.
Editor's Note: This report from the San Francisco Federal Reserve disputes that, and concludes: "We estimate that extended UI increased the overall unemployment rate by only about 0.4 percentage points in the recent episode, which is small in comparison with the peak unemployment rate of 10 percent."
Some of the unemployed might drop out of the labor force altogether without the aid; others might be spurred to search harder for a job.
Editor's Note: A study by the Congress Joint Economic Committee found that among the long-term unemployed, those eligible for benefits spent significantly more time looking for jobs than those who didn’t qualify: "In fact, since Congress enacted federal unemployment benefits, time spent looking for a job has tripled among the long-term unemployed who are out of work as a result of job loss."
Allowing the current program to expire likely would have a modest effect on the U.S. recovery, economists said Without the extended benefits, the annual rate of growth in gross domestic product would be 0.4 percentage point lower in the first quarter of 2014 than if they were continued, JPMorgan Chase economists said in a report released last month.
Editor's Note: According to the Economic Policy Institute, we could lose an additional 310,000 jobs by NOT renewing federal extended unemployment benefits for 1.3 million unemployed Americans.
Casey Mulligan, a University of Chicago economist, said that the benefits may make companies more likely to choose layoffs instead of other cost-cutting measures, since companies know the pain of the layoffs will be reduced due to the benefits. The benefits also make workers less likely to accept lower paying jobs, he said, which keeps unemployment elevated.
Editor's Note: That would have to be a pretty shitty-paying job to pay LESS than unemployment benefits --- and besides, Casey Milligan was thoroughly debunked here.
Excerpts from other Articles by Josh Mitchell
WSJ - The unemployment gap between college grads and high-school grads — a defining characteristic of the recovery — likely widened. The latest drop reflected more college grads getting jobs, rather than departures from the labor force. Of course, though college grads are getting the lion’s share of the jobs, it doesn’t mean those are good jobs. Overall employment gains have come from lower wage jobs, with many graduates underemployed.
Editor's Note: That's why I said, for High School grads, the labor market is brutal. L.A. Times: "College-educated workers are taking jobs that don't require degrees. College graduates are tending bar and driving taxis, pushing people without degrees out of those jobs."
WSJ - The economic growth is below par, hardly justifying a healthy and sustained trend. The economy has not created enough jobs to match the pre-recession levels. There are too many workers working part-time involuntarily. The unemployment rate has been falling for the wrong reasons: The labor participation rate is near record low even though the rate inched up in November. The vast majority of the jobs created in this upswing are lower paying service jobs.
Editor's Note: That's why I said: Over the past 5 years, the U.S. has had an estimated 15.4 million high school graduates and 6.8 million newly retired and disabled workers. A 14-page report by Rutgers notes a whopping 44% of high school students were unemployed ----- meaning: Since Obama's first year in office, the U.S. has had more "non-starters" than "quitters" in the labor force.
WSJ - The October unemployment rate was a staggering 31.9% in Yuma, Ariz. and 25.2% in El Centro, Calif.