Tuesday, February 25, 2014

Still Long-Term Unemployed in 2014

And still forgotten, just as they were in 2009, 2010, 2011, 2012 and 2013. Only now, they no longer have unemployment benefits...adding further injury to insult to injury.

Misery loves company -- If you lose power in a storm, you hope that the whole area lost power with you, because the utility will work hard to restore electricity when many people are affected. It’s a little bit like that with unemployment: It’s not good to be the only one around without a job, because you’re easily forgotten in the general prosperity...The more the overall job market recovers, the more the long-term unemployed tend to get ignored—or even worse, treated as losers or shirkers.

The Shame of America's Long-Term Unemployment Crisis -- Washington is failing the long-term unemployed. And it's mostly the GOP's fault. --- The anxiety about extending unemployment benefits is nonsensical. Republicans like Rand Paul have argued that these checks artificially raise unemployment, since they literally pay people to be unemployed. It might be true, but jobless benefits also literally pay people to look for work. When the checks run out, many people stop looking. The San Francisco Fed concluded that extended benefits raise unemployment by 0.4 percentage points—but mostly because they encourage people to stay in the labor force, which means they count against the unemployment rate. Summed up: "Extended unemployment benefits haven't kept people from trying; they've kept people from giving up."

Why Washington Saved the Economy, Then Permanently Destroyed the Labor Market -- Comparing Washington's reaction to the banking crisis and the unemployment crisis shows how and why government focuses on the rich and ignores the rest.

Bloomberg (re: study) -- For liberals, it’s evidence that workers are reacting rationally to a bad job market, withdrawing rather than wasting time looking for jobs that don’t exist. For conservatives, it’s evidence that unemployment benefits are encouraging people to sit at home collecting checks until their benefits run out—paying people not to work, and that’s what they’ll do. Liberals tend to emphasize a rational decision to step back as you exhaust your most obvious leads, and conservatives blame bad incentives.

But Krueger and Mueller came up with a third explanation: People stop looking for a job because it’s so unpleasant. They asked respondents to provide detailed information about what they’d done over the course of the previous week, and how their various activities had affected their mood. Most ranked their job search highest on stress and anxiety, and lowest on happiness.

A job search gets more unpleasant as time goes by. The longer you spend looking, the more unhappy it makes you, and the more anxious you become about being unemployed. This should make you try harder to find a job. But Krueger and Mueller suggest that heightened anxiety actually had the opposite effect. People tend to want to minimize the amount of time they spend feeling miserable. So they try not to think about it, which isn’t a great recipe for finding a job.

Carolina Comeback Masks Long-Term Unemployment -- The North Carolina Justice Center found that 89 percent of the reduction in unemployment in the state in 2013 was due not to people rousing themselves to go out and look for jobs, but to people leaving the workforce entirely...More than nine times as many people fell off the unemployment rolls as found new jobs. The fact that people were receiving benefits was not the problem. The problem is that there aren’t enough jobs for people who want to work.

The mental anguish of the long-term unemployed -- One in two of the respondents in the two-year national study said they began avoiding friends and associates out of a sense of shame and embarrassment — a self-imposed isolation that hurt their ability to network to find work. Long-term unemployment frequently causes depression, drug and alcohol abuses, spousal abuse, divorce, and even suicide. Carl Van Horn, a professor of public policy and economics at Rutgers and head of the Heldrich Center, said this week:

"Because of the persistence of high levels of long term unemployment there are millions of people who are suffering from mental health problems and many of them are going untreated by professionals. Losing a job is more than just a financial crisis for people. It creates numerous other damage: stress, anxiety, substance abuse, fights, and conflicts in the family and feelings of embarrassment and depression."

STUDY: Unemployment Insurance and Disability Insurance in the Great Recession: We find no indication that expiration of UI benefits causes DI applications. Our estimates are sufficiently precise to rule out effects of meaningful magnitude.

Personal stories of the long-term unemployed at PBS


  1. //////////-- UPDATE

    Even if the Senate passes an extension, the Republican-controlled House of Representatives is unlikely to play along. House Republicans will either consider their own version of the legislation or, more than likely, not consider anything at all.


  2. Food pantries are bracing for increased demand after another round of cuts to food stamps. The latest Farm Bill reduces Supplemental Nutrition Assistance Program funding by $8.6 billion at a time when area food banks are already helping more people.


  3. NPR:

    "You have more people who ultimately decided that they are going to take a lower-paying job. And this has consequences all the way down the ladder. If you're a higher-skilled worker and you take a lower-paying job, you're displacing somebody who might have lower skills, and they can't find a job as a result. And these are conditions that can, as we said, play out for decades. And that's the real long-term trauma of an unemployment spell like we've had."