Long-Term Unemployment: Is There a Solution?

While the unemployment rate has declined from 7.9 percent at the start of the year to 7 percent in November—and may well drop below 7 percent when December's data is released next month—one group of unemployed workers remains in crisis: the long-term unemployed. 

In looking at some of the BLS' data to get a sense of the employment market over the past year (more on that to follow in later posts), I came across the figures for unemployment by length of time out of work, and they make for some fairly grim reading—not least because they've been getting worse for most of the year, even as the overall unemployment picture has been improving. 

Out of a total of around 10.2 million people currently looking but unable to find work, around 5.6 million—55.2 percent—have been out of work for at least 15 weeks. Worse yet is that the prospect of finding a new job seems to decrease the longer someone is out of work. Consider the following (unadjusted) numbers, from November's jobs report:

Proportion of unemployed population, by duration of unemployment: 

Less than 5 weeks: 21 percent

5 to 14 weeks: 23.8 percent

15 to 26 weeks: 16.3 percent

27 weeks and over: 38.8 percent

That last figure is not a typo: almost 40 percent of the total number of unemployed people in the U.S. today have been out of work for a minimum of six months. Many of those people have been out of work for significantly longer, and there are still more that have dropped out of the official count because they've been unemployed so long that they've simply given up looking. 

That adds up to a rather alarming fact: that the longer you're out of work, the lower your prospects of ever finding a new job become. The reasons for that are fairly simple: in an employer's market, such as we have now, one of the criteria that firms use to screen out resumes is to eliminate those from people who are not currently, or have not recently been, working. While the reasons for doing so may be logical—people who haven't worked recently are less likely to be up on current technologies, skills and industry knowledge, and therefore less likely to be able to hit the ground running—it's clear that someone who is stuck in the limbo of wanting to work but having been out of a job for too long is going to need to try to fill the gaps on their resume. 

In a recent post covering the issue for Slate, Matt Yglesias reached the dire conclusion that many of the long-term unemployed "probably won't be able to find jobs ever." After walking through the available options for a mass-scale approach to the problem—from government works programs to mobilizing for war—Yglesias concluded that, as a society, "We're going to do nothing. We're going to tell people to go out and look for work, even though employers looking to hire can still afford to be very choosy and generally refuse to even consider the long-term unemployed as job applicants." 

If there is a ray of hope to be found here, then, it's going to have to be at the individual level. A point that can never be overstated enough is that, regardless of what's happening in the wider economy, an individual's career is within their own control. Where jobs have flowed out of an industry and seem unlikely to return, for example, those who train for new positions and industries are more likely to have success in avoiding obsolescence than those who simply try to find one of the diminishing number of jobs they are experienced or qualified in. 

In an upcoming post, I'll be looking at more of the BLS data to find some of the areas that have shown job growth in 2013, as well as those that have declined. For an advance preview, though, consider this point: many of the growing areas are fields that require intellectual capital, and/or will help us meet society's needs in the coming years: energy, utilities, professional services and the like. As difficult as it is to shift careers and/or change industries—extra training and education is usually expensive, and relocation is often a barrier—it is possible. Maybe not at mass scale, but certainly at an individual level; and short of a policy rethink at a national level, the individual level is where this crisis is going to have be solved: one jobseeker at a time. 

Read More:

The Long-Term Unemployed Are Doomed (Slate)

BLS Employment Situation Summary 

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