The Human Disaster of Unemployment

The American economy is experiencing a crisis in long-term unemployment that has enormous human and economic costs. In 2007, before Great Recession, people who were looking for work for more than six months, the definition of long-term unemployment, accounted for just 0.8% of the labor force. The recession has radically changed this picture. In 2010, the long-term unemployed accounted for 4.2% of work force. That figure would be 50 percent higher if we added the people who gave up looking for work. Long-term unemployment is experienced disproportionately by the young, the old, the less educated, and African-American and Latino workers. While older workers are less likely to be laid off than younger, they are about half as likely to be rehired. One result is that older workers have seen the largest proportionate increase in unemployment in this downturn. The number of unemployed people between ages 50 and 65 has more than doubled. Prospects for the re-employment of older workers deteriorate sharply the longer they are unemployed. A worker between ages 50 and 61 who has been unemployed for 17 months has only about a 9% chance of finding a new job in the next three months. A worker who is 62 or older and in the same situation has only about a 6% chance. As unemployment increases in duration, these slim chances drop steadily. The result is nothing short of a national emergency. Millions of workers have been disconnected from the work force, and possibly even from society. If they are not reconnected, the costs to them and to society will be grim. Unemployment is almost always a traumatic event, especially for older workers. A paper by the economists Daniel Sullivan and Till von Wachter estimates a 50 to 100% increase in death rates for older male workers in the years immediately following a job loss, if they previously had been consistently employed. This higher mortality rate implies that a male worker displaced in midcareer can expect to live about one and a half years less than a worker who keeps his job. There are various reasons for this rise in mortality. One is suicide. A recent study found that a 10 percent increase in the unemployment rate (say from 8 to 8.8%) would increase suicide rate for males by 1.47%. This is not a small effect. Assuming a link of that scale, increase in unemployment would lead to an additional 128 suicides per month in the United States. The picture for long-term unemployed is especially disturbing. The duration of unemployment is the dominant force in relationship between joblessness and risk of suicide. Joblessness is also associated with some serious illnesses, although the causal links are poorly understood. Studies have found strong links between unemployment and cancer, with the unemployed men facing a 25% higher risk of dying of the disease. Similarly, higher risks have been found for heart disease and psychiatric problems (…..)

Link: http://www.nytimes.com/2012/05/13/opinion/sunday/the-human-disaster-of-unemployment.html

Acerca de ignaciocovelo
Consultor Internacional

One Response to The Human Disaster of Unemployment

  1. Professor Uziel Nogueira says: This piece brings an important contribution to the unemployment debate. It advocates the need of a comprehensive re-employment policy that addresses the specific needs of the LONG-TERM UNEMPLOYED. This recommendation makes sense for those who perceive the current unemployment NOT as a short term but a long term phenomenon. What are the chances of such recommendation to gain traction and be implemented? There are two major factors going against this proposal. First, mainstream economists are not convinced that unemployment is structural i.e, long term. In consequence, both political parties are not convinced about the need of such re-employment policies. Second, the US economic model is NOT structured to deal with long term unemployment. Any changes in the model means transferring power from one sector to another of society. This implies important changes in legislation and economic policy making. There will be winners and losers. Democrats and Republicans are not prepared to compromise on such controversial issue. In sum, the future for the long term unemployed is not positive unless something dramatic occurs and society/government accept the idea that high unemployment rate is a normal fixture of the economy.

    http://www.nytimes.com/2012/05/13/opinion/sunday/the-human-disaster-of-unemployment.html

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