Why is Chronic Joblessness on the Rise?

By Bob L.
07/08/2011

This will never be like it used to be untill our Governments stop raising taxes, and learn how to say no to all these yuppies that want all this fancy stuff that is not beneficial to creating full-time jobs not part-time or temporary, but as long as they keep spending taxpayer money on thing that are not needed, there will never be a job to keep people working, the way I feel is if it is some thing you want then you pay for it not the taxpayer.

Why do we need Schools that are spread out over Fifty Acres and costing Millions Dollars, or why are we building Post offices that here again cost millions, in all, these cases and more are bankrupting this Country, what is wrong with going back to building less appealing and more functional to get a better Education and keep more jobs, I keep forgetting yuppies want it all and the best, NO MATTER WHAT IT COST.

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TIME.com

Posted by Roya Wolverson
Wednesday, June 8, 2011

The quip “don’t quit your day job” isn’t the insult it used to be. In this
economy, it’s the key to staying afloat.

Not only is joblessness on the rise again, according to Friday’s jobs
numbers, which showed May unemployment ticked up to 9.1%. But the longer you’re
out of work, the harder it is to get back in. Roughly 45% of unemployed
Americans have been jobless for more than six months, a higher percentage than
during the Great Depression. And nearly one-third have been out of work for a
year or more. Those scary prospects have driven a lot of employees to hunker
down in existing jobs for longer than they normally would, which partly explains
why unemployment is staying so high.

PHOTOS: New Jobs
for a New Economy in Austin

Worker mobility, which greases the wheels of hiring, dropped off sharply last
year. And although it’s starting to creep back up, the number of job seekers who
successfully relocate for new positions is still historically low, according to
research firm Challenger, Gray, & Christmas. Fewer than 10% of job searchers
relocated for a new position in this year’s first quarter, a nearly 50% drop
from mid-2009. “What’s unique in this job cycle is hires and fires are very low,
and fewer people are quitting jobs,” says Jeffrey Cleveland, senior economist at
investment firm Payden & Rygel.

Taking jobs in other cities is harder in a dreary housing market, which keeps
more people tied to their homes. But falling worker mobility is also a
longer-term trend, which this recession simply made worse. According to a recent
Fed paper, worker migration has been declining since the 1980s, with only
limited ties to the housing market and recessions.

The causes for slower worker movement aren’t easy to trace, but the effects
are becoming clear. Stodgy mobility keeps workers from freeing up jobs,
improving their skills, and trying new things. Those are especially important to
fixing today’s unemployment problem, since more and more employers are finding
job candidates don’t have the right skills to match what they have on offer.
Employers also think less of job candidates’ skills the longer they stay out of
work. “Being out of work a year or two represents a big decline in
marketability,” says New York-based financial planner Anthony Canale, who runs a
new program with the Financial Planning Association to help job seekers find
jobs.

Those without permanent jobs also have fewer temporary options to fall back
on. At this point in the recession, businesses would typically be easing back
into full-time hiring by creating more short-term gigs. But over the past few
months, even the number of temporary jobs created has been heading downhill,
which adds more workers to the ranks of the chronically unemployment. The
consequences can mean lower earning power for years to come, especially for
young people. A recent
study
by Rutgers University found more than 30% of recent college grads

between 2006 and 2010 hadn’t landed a job within six months of finishing school.
And
a study
by Yale economist Lisa Kahn found college grads who enter the

workforce in a weak economy spend years earning less than those who enter the
workforce during boom years. (More on Time.com: See
a special report on the future of work
)

What’s worse, there aren’t many fixes on offer. Corporations say they aren’t
budging on hiring without more clarity on financial regulation, the strength of
the global recovery, and the shakeout on healthcare. Meanwhile, Austen Goolsbee,
outgoing head of the White House Council of Economic Advisers, has suggested
that jolting the recovery is no longer the White House’s job: “We’ve got to rely
on government policies that are trying to leverage the private sector and give
incentives to the private sector to be doing the growth.” President Obama
suggested this week he would consider more stimulus, but Congress’s recent
austerity kick makes passing more fiscal measures a long shot. There’s also talk
of the Fed launching another round of quantitative easing (QE3). But while
another bond-buying binge might boost stock prices for a while, it’s hard to
envision that spurring job growth.

“The truth is, there aren’t many short-term fixes. The real answers to the
jobs problem will take more time,” says University of Chicago economist Raghuram
Rajan. And that means chronic unemployment may continue to rise.

So what can the jobless do to stay fresh in the job-hunting game?
“Volunteering, courses, workshops, things that show you’re continuing to grow,”
Canale says. Not only do these activities build skills; they offer a chance to
network and get new ideas. “Sometimes just by connecting the dots in seminars,
we’re able to get people a job interview,” he says.

Workshops and seminars can also be a bridge into different industries. A lot
of firms are using the recession to make big strategic shifts they should have
made years ago. And as those firms take new directions, successful job hunting
will require workers to move with them and consider new fields. Switching
sectors can be a tough and costly process, but Canale says there are a lot of
ways to pick up training for free. Many pubic libraries, for instance, offer
free seminars on things like basic investing and computer science.

These aren’t just lessons for the jobless. Rising chronic unemployment means
even workers who feel comfortably employed should be better prepared for
worst-case scenarios. The most important step while you have a job is to
increase household savings, says Canale. Personal savings rates in the U.S. have
been creeping up (up to nearly 5% on average from a measly 2% pre-crisis), but
in
a recent study
by the National Bureau of Economic Research, roughly one

quarter of Americans said they couldn’t come up with $2,000 in 30 days.

The hardest part of boosting savings can be figuring out where to start.
“It’s never about what you make. It’s always about what you spend, and the
average person has no idea what that is,” says Canale, who recommends devoting
one month to tracking household expenses to tally the bare bones of what you
regularly owe. “Only once you know your household expenses can you start to
eliminate and make lifestyle choices.” Another important step is regularly
evaluating your skills to make sure you’ve still got what employers need. “It’s
an extremely hard thing to do, but I have to re-tool myself every 6 months,”
says Rajan.

The good news is high chronic joblessness won’t last forever. As incomes and
wages in emerging markets continue to rise, global companies focused abroad will
gradually turn back to investing in U.S. jobs. In the meantime, keeping your
spot in the job market may come down to investing more in yourself.
(More on Time.com: See
a special report on how to know when the economy is turning
up
)

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Categories: America, Education, government, Jobs, Lives, money, people, unemployed | Tags: , , , , , | Leave a comment

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