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The June Jobs Report and Long-term Unemployment

July 2, 2009 RSS Feed Print

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The bad news in June's jobs report is slightly insidious. From the outside, it doesn't look so bad. It's not like we had the kinds of job losses we had earlier this year. But there are many, many ugly things in this report. A list:

Job losses were a good deal higher than expected: 467,000 vs. 365,000
The average workweek hit a record low, thanks to employers slashing payroll hours.
The U6 measure--an alternate measure of unemployment that includes part-timers who want full-time jobs, and discouraged people who are unemployed but have stopped looking for work--hit 16.5 percent.
The teen unemployment rate hit 24 percent. (That does not mean that 24 percent of teenagers aren't working. That means that 24 percent of teenagers who want jobs cannot find them.)
Hourly earnings were flat, but hours have been cut, so weekly earnings fell in June.
Male v. female unemployment rate: 10 v. 7.6

The number of people out of work for 27 weeks or more has hit 4.4 million--that's 3 in 10 unemployed workers.
People are beginning to drop out of the labor force. The workforce decreased from 155.1 million in May to 154.9 million in June.

There are some good things--like the fact that job losses are clearly slowing. Also, the unemployment rate ticked up by a smaller amount than most economists had forecasted.

One crucial thing here is the issue of longterm unemployment. Workers who are out of the labor force for very long periods of time can lose out on skills development. There is a very, very strong case to be made for doing volunteer work, re-training, even adult unpaid internships, during unemployment. You'll continue to build skills, connections, and have something to put down on your resume or relate in conversation or at interviews. Pessimism is the other baggage that comes with longterm unemployment. Companies like to hire positive people--especially when businesses are trying to claw their way back post-recession. Workers need to be aware that it's as important to take care of their attitudes as it is their skills during a period of unemployment. It is hard to hide a fatalistic attitude. Find a way to kick it as often as it pops up.

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I've been unemployed since 2004 thanks to my industry going off shore. I've managed by getting projects and short term gigs. Even those dried up in 2007/2008.
What ATTITUDE says is true. At this time, I finally got a w-2 job that I drive 110 miles a day for. My 12yo vehicle with 160k miles, is on its last legs and has caused me to miss work for lack of transport. I need to work at least 3 more months to save up enough to buy another (hopefully better, but not new) vehicle. I'm working for 1/3rd what I worked for before and my health suffers from the effects of long term "fake but cheap" food.
The economy is not going to "bounce back". It has gone splat. We are now competing against off-shore workers. My job that now pays $65k/yr in the US (used to pay $90k in 2003) is now being sent to other countries where workers do it for $20k. Our economy is in the process of splitting. A select few will retain astronomical salaries while the majority must adapt to 3rd world wages.
The housing market is NOT at the bottom. It is far from it! As the pecentage of discounted (salary) employees grows the housing values will continue to fall through the process of forclosures. Just look at Cleveland Ohio. 200 houses/week sold at auction. MANY, MANY houses previously mortgages for the $80k range sold for under #8k. Cleveland is at the front of a wave that will sweep the nation as employers reduce their costs.
Don't believe me? IBM has ousted 15,000 employees this year with senior (in age and salary) taking the biggest hits. Because they increased their Indian employment by 18,000 in that same time, the news reports a net increase in IBM hiring and the ousted US workers were not "laid off".. rather, IBM will report in their SEC filings that they had executed a "resource re-alignment" saving them millions of dollars and increasing their profit margins (while also increasing hiring).
I think my attitude is just fine. I realize that the US is becoming a country where the average worker is a resource to be shopped around the globe. We will soon be a nation where the average wage for a college grad is barely above that paid by fast food companies and pockets of well connected people will aquire wealth never even dreamed of before.
The Bush administration facilitated it. The Obama administration doesn't seem willing to push back (although they aren't flat out facilitating it).
We are incubating our own "extremists" who will fight back. As another said, people without homes or long term jobs have nothing to keep them in check. Thousands of highly educated people who played by the rules for the first half of their life only to have it flushed may just decide to act out. The question will be if they create their own economy or pursue vendetas against the "ruling class".

kay of OH 1:15PM July 11, 2009

Having gone through 6 YEARS (not 6 months)of unemployment and hearing nothing but NO for that time frame I consider myself an expert on the "attitude" subject. To all you "experts" out there, don't tell us (long term unemployed) to smile. Are you NUTS? What do we have to smile about? NO job, possibly losing everything we have worked so hard to build up to. Family and friends turning there backs on us and you telling us to smile. Tell you what, split your paycheck with us and we will smile. People in this long term unemployed catagory need HELP. I was told by a US Senator that I would get help and they could NOT, repeat NOT, make it happen. The psycological effects are devasitating. You lose everything, self respect, confidence, etc. The sad part is people wonder why we have such a "negative" attitude. It's not negative, it's realistic whether you want to believe it or not.
Another sad part is that most companies do NOT understand that, even though the candidate may not have a "positive" attitude I can assure you that most long term unemployed will be very grateful for the chance to earn some kind of income. These are the kinds of people who do remember that "this company gave me a chance.". Most of these will be good employees.
Don't kid yourself. There will be health issues and missed days. How good would you be under the same situation as the person you are hiring. I'm not saying they are going to miss every day, but they have not been eating right or sleeping right for a long time and now they have to. BE PATIENT and give them a chance. Once back on their feet they will remember who gave them that chance.
If hiring a senior citizen expect these issues. Work with them. This country used to care about it's citizens, and that, in particular, was true of the employers of this country. Now it's all statistics. Forget the statistics. Think of your employees first. If you don't take care of your employees, they won't take care of your customers and then where will you be. Hiring new employees probably and losing a ton of experience in the process. Not good.
I am working right now, but don't expect it to last (health issues). I have nothing for retirement and don't know if social security will be there. The only company I worked for long enought to draw retirement from no longer exist. I have no family to help me either. I am an average person who will be 57 this year. I lost eveything I owned during those 6 years of unemployment. Those six years of constant "NO's" have shattered my confidence. I will not recover. I was turned down for request for help by any agency you can name in two different states. I will tell you that the help you hear about being out there is NOT out there. Those people spend as much time figuring out ways to turn down your request as to approve your request. I am grateful to the US Senator who tried to help me, but the fact that a US Senator could not help me, or get me help, should raise flags all over the pla

Terry Wilhelm of TX 3:37PM July 05, 2009

Obama’s ill-advised $700B+ "stimulus" program is a train-wreck: these jobs figures are far worse than the ones the White House warned us about if we DIDN’T pass the bill- so it was passed, and then unemployment soars anyway?
Instead of creating jobs, interest rates were bumped up, the dollar slid... and it didn’t help anybody get any work. Much of this is due to the fact that Obama’s radical agenda has mortified almost every machine of job-and-growth creation in the country.
The One couldn’t deliver the type of "temporary, targeted, and timely" bill that he promised repeatedly- regardless of his image in the MSM as omnipotent, Obama simply lacks the the political stature to control Pelosi and Reid… who hit the trough hard, while bickering like siblings.
And the lack of GOP co-conspirators exposed Obama politically… this legislation now looks to be a HUGE gamble. When all this pork-n-welfare fails to generate any real economic gains, the Democrats will face a bloodbath in 2010.
One could even make the argument that Obama knows his legacy will be in tatters by 2012… and is just ramming through as much of his far-left agenda as he can before the day comes when people cringe at the mere mention of his name… sure seems like it.
http://reaganiterepublicanresistance.blogspot.com/

Reaganite Republican of CA 12:00PM July 03, 2009

The June Jobs Report and Long-term Unemployment

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