While the Great Recession has officially been over for quite some time, there still are pockets of depressing economic news out there. For example, a recent report from three Princeton University economists spells out the plight of the long-term unemployed.
Led by Alan B. Krueger, the study found that only 11 percent of the long-term unemployed in any given month had found full-time work a year later. The study also examined whether a lack of available jobs or whether discrimination on the part of employers is to blame, concluding that both factors play a role. “The demand-side and supply-side effects of long-term unemployment can be viewed as complementary and reinforcing each other as opposed to competing explanations,” the authors wrote.
In other words, there are no simple solutions. Many a competent worker lost his or her job during the Great Recession through no fault of their own. The economic downturn of the past decade created a numbers crunch that entangled good employees in a cycle that is difficult to escape. As their unemployment drags on, skills erode and employers become more likely to doubt a job candidate’s qualifications.
The problem is vast. The proportion of people who have been out of work for at least 27 weeks — the Bureau of Labor Statistics’ definition of “long-term unemployed” — remains higher than at the peak experienced during the recession of 1983. The number rose by 203,000 in February of this year, climbing to 3.8 million, and it is a situation that will have a lingering impact. In addition to lost earnings that never can be recovered, there is a psychological toll on those who are unable to find work, as well as their families. On top of that, the Princeton study found that 30 percent of the long-term unemployed are 50 or older — compared with 20 percent of the short-term unemployed — and those workers become increasingly unlikely to ever re-enter the workforce as they age.