Americans are finding jobs again. The December employment report, out today, showed growth of 200,000 jobs. Since October, the national unemployment rate has declined to 8.5 percent, from 8.9 percent. But even as unemployment lines slowly grow shorter, some workers see no light at the end of the tunnel.
According to the December jobs report, there are nearly 5.6 million people in the U.S. who have been unemployed for six months or more—42.5 percent of all unemployed Americans. Labor Department data shows them to be disproportionately black and Asian. They are slightly more likely to be men than women. They are not as well-educated as their more successful counterparts in the labor force. And the recovery is not benefiting them the same way that it is benefiting other laid-off Americans.
The unemployed population can be roughly split into two camps, says Stephen Rose, senior economist at Georgetown Unviersity's Center on Education and the Workforce: "There are cyclers—those who are there relatively short periods of time, and there's the long-term, who are there year in, year out." The "cyclers" make up a majority of the unemployed population, he says, but the long-term unemployed face a tougher challenge.
The long-term unemployed are not being kept out of work simply by a lack of economic confidence or a temporary decrease in demand for particular goods, says Scot Melland, president and CEO of Dice Holdings, a provider of career websites. "You clearly have a long-term unemployment issue in the U.S., but it's driven, I would argue, much more by structural factors that have to do with—where's the demand for people in the economy?" says Melland.
Once the housing bubble popped, he says, the shape of the economy, particularly with regard to real estate, construction, finance, and state and local government, changed. Particularly in construction, there appears to be little chance in the short- and medium-term of reclaiming that industry's former glory.
Labor Department data shows just how difficult it can be to climb out of long-term unemployment, even in an improving job market.
The average duration of unemployment is stunningly high, at 40.8 weeks—more than nine months. Median unemployment time is also mired at extraordinarily high levels, at 21.0 weeks. By way of comparison, the median number of weeks unemployed remained between 5.8 and 11.5 between 2001 and 2008. And the recovery has had little effect on this figure; in December 2010, when the unemployment rate was 9.4 percent, median unemployment was 22.3 percent. And in December 2009, when unemployment was at 9.9 percent, median unemployment time was below where it is today, at 20.3 weeks.
"The long-term unemployed always have a problem being re-employed. This is not new," says Rose. However, the scope of the problem is new, he says, and it means a relatively large segment of the population whose chance of re-employment is shrinking by the day. Long-term unemployment not only means that a potential worker's job skills start to atrophy; it also makes that person less attractive to employers.
"It's a black mark [on your resume] when you go to look for a job and you've been [long-term] unemployed," says Rose.
Fortunately, manufacturing—one area of the economy that was particularly savaged by the recent recession—is seeing growth as the U.S. again becomes more globally competitive in that industry, and as high-tech manufacturers see sustained health.
But many long-term unemployed are not skilled enough to work in growth areas like manufacturing, as well as healthcare. As such, some advocacy organizations are calling on Congress to help the long-term unemployed.
"As a first order of business, Congress should quickly approve a long-term renewal of federal unemployment insurance," said Christine Owens, executive director of the National Employment Law Project, in a statement today.
She also emphasized the need to retrain workers who need additional skills in order to work again. "We also need effective, targeted responses like education and training opportunities to give jobseekers the tools to rejoin the workforce and contribute at their fullest potential," says Owens. Given Congress' recent track record for agreement, particularly on economic issues, the prospects look bleak.
An earlier version of this article [0106longterm] misspelled Scot Melland's name.