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Growing ranks of long-term jobless face tough odds

Jeannine Aversa | Hagadone News Network | UPDATED 15 years AGO
by Jeannine Aversa
| June 6, 2010 9:00 PM

WASHINGTON - If you lose your job these days, it's worth scrambling to find a new one - fast.

After six months of unemployment, your chances of landing work dwindle.

The proportion of people jobless for six months or more has accelerated in the past year and now makes up 46 percent of the unemployed. That's the highest percentage on records dating to 1948. By late summer or early fall, they are expected to make up half of all jobless Americans.

Economists say those out of work for six months or more risk becoming less and less employable. Their skills can erode, their confidence falter, their contacts dry up. Their growing ranks also will keep pressure on Congress to keep extending jobless benefits, which now run for up to 99 weeks.

Overall, the economy has created a net 982,000 jobs this year. But for Jeff Martinez and the record 6.76 million others who have struck out for six months or more, their struggles are getting worse, not better.

Martinez, 40, a salesman in Washington, D.C., says he's logged more than 200 interviews in the past three years. Decked out in a dark navy suit and Burberry tie, Martinez projects drive and a zest for deal-making. And yet the most urgent deal of his career - finding a job - eludes him.

"You have days where you feel motivated and hopeful and optimistic," he says. "Then there are other days, you really lose the faith and think, 'I'm never going to get another job. Ever.'"

What's causing the rising ranks of the long-term jobless to exceed the pace of other recessions?

Mainly, it's the depth and duration of the job-slashing this time. Since the recession began in December 2007 through May this year, a net 7.4 million jobs have vanished. The unemployment rate has surged nearly 5 percentage points: From 5 percent in December 2007 to 9.7 percent in May.

By contrast, in the last severe recession, the rate rose less sharply over a shorter period: From 7.2 percent in July 1981 to 10.8 percent at the end of 1982.

Lawrence Mishel, president of the Economic Policy Institute, points to the "sheer scale of the falloff in demand for workers" this time. It's left more people out of work for longer stretches. And it's intensified competition for each opening.

"It's a cruel game of musical chairs," Mishel says.

To lower the unemployment rate from the current 9.7 percent to a more normal 6 percent would require roughly a net 15 million new jobs by the end of 2016, estimates Brian Bethune, chief U.S. financial economist at IHS Global Insight.

Few think that's likely.

One factor behind the growing proportion of the long-term unemployed is the erosion of their workplace skills - or employers' perception of it. It's hard to find work in a tight job market when your skills are seen as stale.

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