The Elephants in the Room of Economic Recovery: 99ers and The Long-term Unemployed
The latest BLS employment report showed a gain of 244,000 jobs for April, which was trumpeted by the Obama administration and the media as a continuation of a rapidly improving jobs market. While job growth is important, it’s also important to realize the jobs hole that needs to be filled. Over the past four months more than 800,000 jobs have been created, but in January 2009 alone, more than 800,000 jobs were lost. Since February 2010, 1.8 million jobs have been created, but 8.8 million jobs were lost prior to that period. That’s a job shortage of 7 million and that doesn’t include the 125,000 jobs each month that needed to be created to simply absorb new entrants into the workforce.
Additionally, the unemployment rate increased to 9%, since more people began looking for work. Returning job seekers is often considered an improved sign of job availability, but if they aren’t hired, they will go back into hiding and the unemployment rate will decline. Because of returning job seekers, the number of officially unemployed increased 205,000 to 13.75 million, which is still historically high when compared to other jobs challenged times.
One of the few honest assessments of the current jobs market was offered by Heidi Shierholz of the Economic Policy Institute:
At this point, coming out of a recession this deep, we should be getting unambiguously huge growth, of 300,000 to 400,000 [new jobs] a month," said Heidi Shierholz, a labor economist at the Economic Policy Institute. "And it's just nowhere near that." She concluded: "We're still in a rocky place."
The job market is admittedly improving for some, but it’s not improving quickly enough for millions of jobless, especially the long-term unemployed. In April, the ranks of the unemployed who have been out of work for 99 weeks or more increased by 21,000 to a record 1,920,000. That equates to 14.5% of all unemployed.
Other long-term unemployed fared a little better in April compared to March. Those out of work for 26 weeks or more decreased from 5.839 million from 6.122 million in March. But their percentage of the overall unemployment rate remained elevated at a near record level of 43.2%. The percentage of those out of work for more and 52 weeks increased from 31.5% to 32.8% of all unemployed.
The mainstream media, Congress and the Obama administration don’t often mention the long-term unemployed. How do they reconcile the fact that 244,000 jobs were created, but 21,000 additional workers have been unemployed for more than 99 weeks? How do they put on a happy face when a near record 5.893 million or 43.2% of all unemployed workers have been jobless for more than 26 weeks? How do they rationalize their cheerful statements of job improvements with the facts that job creation is very weak considering the trillions of dollars pumped into the economy to support Wall Street and fund tax breaks? How do they high-five the economic recovery when the labor force participation rate - the share of people over age 16 who are either working or actively seeking work — is at a low rate of 64.2%, a rate not seen since 1985? They can’t. They generally ignore the issue; long-term unemployment is the elephant in the economic recovery room.
What is being done legislatively to address this elephant in the room? To date, nothing. The GOP controlled House has been busy trying to cut the deficit, repeal healthcare funding, and restart offshore oil drilling. The Republicans, with the help of some Democrats, are attempting to weaken Wall Street regulation legislation, end net neutrality, and are arguing the Defense of Marriage Act. They are pandering to their base, acquiescing to their corporate overlords and obliging their big-wallet campaign contributors. These congressional laggards have not presented a jobs bill or employment training legislation, conducted investigations on how to solve long-term unemployment, or offered tax incentives for companies to hire the long-term unemployed. They have ignored legislation, such as Rep. Barbara Lee’s H.R. 589, that would help millions of long-term unemployed, the 99ers, who have exhausted all unemployment benefits. While most of the blame can be placed at the door of the GOP controlled House, the Democratic controlled Senate and Obama have been suspiciously silent about the long-term unemployment problem.
Long-term unemployment is not only a national tragedy, but it is a personal tragedy as well. Rochelle Sevier was laid off in October 2008 while working as a recruitment coordinator for a biotech firm. Since that time, “I started my job search immediately. In addition to my job search, I attended various workshops at my local career center. As part of my search I attended job fairs, partnered with temp agencies, posted my resume online, and also submitted my resume to various positions.” During the past couple of years Rochelle took part-time temporary positions that included folding sweaters and stuffing envelopes. Her unemployment benefits ended in September 2010 and she didn’t find another job until January 2011 when an administrative position became available. Unfortunately that job ended six weeks later, “I finished out my 6th week and now I am back to square one. This rejection affected my emotional and mental state. I started to feel hopeless and depressed because I now feel like I will never work again.”
The long-term unemployed are also part of the growing ranks of food stamp recipients, personal bankruptcies, foreclosures and healthcare uninsured. Ellen Turner, who was laid off from her job in December 2008 has struggled with healthcare costs since her COBRA plan ended in June 2010. “Now I have nothing. Hoping I can stay fairly healthy till I reach 65, and I can get Medicare. I have one knee without cartilage that has to be replaced...at a cost of 10k. Can't do it. I have severe osteoporosis; I need fusions of reclast every year. This year, the pharmaceutical co. provided the reclast, I only have to pay for the doctor visit and lab fees: $136 bucks total. I am fortunate that I can pay this, while others at my age cannot. I turned 63 on May 10th.” Ellen is now one of the more than 50 million Americans who do not have healthcare.
Susan R sent the following cry for help: “Any idea on what is happening with HR 589? My unemployment ends end of the month and I cannot get a job. I have tried everywhere. I used to be a legal secretary but now they want college which I do not have, Now you have to apply for stores, etc. online and I never hear back. I think my only hope is to kill myself. There is no hope. Also they keep saying things are getting better but I don't see where and neither does anyone I talk to. Everyone says things are bad!!”
H.R. 589 is legislation is designed to help the long-term unemployed by extending Tier 1 unemployment benefits another 14 weeks. Those 14 weeks could be a financial lifesaver for millions of unemployed. Although the legislation has been discussed for months, moving it forward in a Republican controlled House will be challenging. How challenging? House Republicans are hoping to introduce legislation that could cut extended unemployment benefits in favor of lower business taxes and allow states to spend that money on other programs:
The Ways and Means Committee passed a bill by 20-14 today that lets states shift some of the $31 billion they are set to get for extended unemployment aid to prevent the tax increases, pay back federal loans or fund job-training programs.
While those are all commendable options, they are long-term rewards that won’t help those that need immediate financial assistance. Oil companies have reported record profits, but the GOP favors giving them billions in taxpayer subsidies while at the same time forcing the long-term unemployed to suffer without any financial assistance.
The latest H.R.589 update comes from Crew of 42’s Lauren Victoria Burke; the news is both positive and disappointing:
The good news for 99ers: The President mentioned he wants to possibly attach the 99ers money to some other big piece of legislation somehow… which piece, how and when is unclear…
The bad news for 99ers: The President does not seem deeply motivated to to actively support unemployment benefits in general terms.
Congress needs to address the elephants in the room, since millions of Americans are being sidelined by a relatively weak job market. That needs to change quickly and dramatically or more hard-working individuals such as Rochelle, Ellen and Susan will continue to bear the financial hardship and personal pain of long-term unemployment. Open your eyes now, Congress.