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Thursday, March 29, 2012

Structural Unemployment


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March 28, 2012
Column: Unemployment is the problem that won't go away
Dale McFeatters

The United States may soon face a problem that has bedeviled Europe's industrialized nations — endemic and chronic unemployment — and the nation's leaders are making little effort to prepare for it.

Surveying the platforms of the presidential hopefuls, Scripps Howard News Service reporter Bartholomew Sullivan wrote that none "addresses the prospect of permanent unemployment for a class of often middle-aged, semi-skilled workers whose jobs have disappeared and are unlikely to return."

And, he found, there is a real dearth of entry-level jobs with the prospect of advancement.

In other words, some American adults may never again enjoy meaningful employment, with very little in the way of a social safety net for able-bodied adults.

Unemployment benefits have been repeatedly extended and expanded — 10 times since 2008 — up to a maximum of 99 weeks in some hard-hit states. But Congress has been losing its enthusiasm for further extensions and in February voted to gradually begin scaling back the duration of the benefits.

A General Accountability Office study last month found that less than 3 percent of those who exhausted their benefits in 2009 were eligible for a major safety net program — Temporary Assistance to Needy Families — because most were too old to have dependent children. About 21 percent found their way onto a Social Security program but, as Sullivan points out, these programs were never intended as safety nets "for the able-bodied formerly employed."

Historically, the United States has relied on robust economic recoveries to resolve unemployment. But while the economy is now in a recovery that shows every evidence of getting stronger, many of the jobless are being left behind.

Some 5.1 million of them today have been out of work six months or longer; 8.1 million can only find part-time work; and at least another 1 million have quit looking altogether.

Many labor analysts, as Sullivan finds, believe the U.S. is entering a period of structural unemployment: Workers, especially older ones, don't have the skills that employers want; or the industries in which they've spent their careers have disappeared or relocated. Thanks to the productivity gains from automation, there's not enough work to go around.

The nation's leadership seems philosophical about, even resigned to, periodic bouts of severe joblessness.

In 1972, both Republican and Democratic political platforms endorsed full employment, a job for everyone willing to take one. By 1992, those planks had disappeared. While the Obama administration has endorsed some tightly targeted employment programs, there is no appetite at either end of Pennsylvania Avenue for the kind of massive public works projects that sustained employment during the Depression.

We may indeed be looking a lot more like Europe but not in the way anybody wants.

Dale McFeatters writes for the Scripps Howard News Service.

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