Archive for October, 2010


Wednesday, October 6th, 2010


The past recession has hit the labor market especially hard. Over the course of the recession, the U.S. economy shrank by 4.15 percent. A total of 8.3 million jobs were lost, and the unemployment rate rose 4.7 percent to a peak of 10.1 percent in late 2009. Currently, more than 14.5 million people are officially unemployed and many are underemployed. More striking is the length of time that people remain unemployed. Unemployed workers stay out of work for 34 weeks on average now, about 50 percent longer than previous unemployment cycles.

These large affects on the shock of the labor market raise the question on how unemployment is likely to evolve during the recovery and the long run. I also would like to expose life on unemployment.


I want to focus on the negative impact of long-term unemployment on the workforce. Longer unemployment durations are a problem because unemployed workers who are unemployed for too long lose job- specific- skills. Losing skills can reduce their odds of finding a job during recovery.

Many signs point to a relatively slow adjustment for the labor market: the negative effects of the large pool of long term unemployed (due to skill loss), low demand for labor, as measured by job vacancies and openings and a relatively large pool of underemployed in the form of part time workers due to economic slack.

The obstacles are language barriers. Many people that come to the workforce center speak little English and some do not have cell phones or house phones because of their benefits were terminated. I will also mention how easy it is for the government to terminate your benefits and the three week grace period for it to be reinstated. You can imagine how hazardous that can be.

I will interview Jennifer Warsen of the Department of Labor Division of Employment and Workforce Solutions office. I will also interview family friends that are on unemployment into what their day-to-day struggle is.

Works Cited:

Book: “The Labor Market in the Great Recession” by Michael Elsby (Spring 2010) tales-from-the-unemployment-line

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