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Sunday, September 05, 2010

More stories on the long term unemployed

by Calculated Risk on 9/05/2010 09:02:00 AM

From Alana Semuels at the LA Times: For many unemployed workers, jobs aren't coming back. A few excerpts:

The U.S. safety net wasn't designed to withstand such a strain. The extent and duration of unemployment benefits vary by state, but 26 weeks is typical. Several federal extensions have increased that to 99 weeks in California and other hard-hit states. Even so, an estimated 3.5 million Americans will have run out of benefits by the end of the year. About 180,000 Californians have already fallen off the rolls.

There are few other places to turn. Applications for federal food stamps and state programs such as CalWorks, which provides temporary assistance to families with children, are up sharply in recent years.
Desperation is growing, said Ofer Sharone, an assistant professor at MIT's Sloan School of Management who has spent the last year interviewing dozens of long-term jobless workers.

"The U.S. is clearly not equipped to deal with this high level of unemployment," Sharone said. "People are running out of benefits, health insurance, retirement and pensions."
This article has several stories about people struggling with long term unemployment.

This brings up two key points:
  • What will happen to the '99ers? According to Semuels, 3.5 million Americans will run out of benefits by the end of the year. No jobs and no benefits means fewer households and more vacant housing units - not exactly what we need.

  • Job creation will pick up when the excess supply of housing units, and the over capacity in many other sectors, is finally absorbed. That will happen eventually as the population grows and households are formed.