re: #111 Ericus58

Millions of unemployed may never recover

[Link: seattletimes.nwsource.com…]

…
Never since the Great Depression has the U.S. labor market seen anything like it. The previous high in long-term unemployment was 26 percent in June 1983, just after the deep downturn of the early ’80s. The 44 percent rate this year translates into more than 6.5 million people.

In fact, nearly two-thirds of these workers actually have been jobless for a year or longer, new Labor Department reports show.

“I’m particularly concerned about that statistic, because long spells of unemployment erode skills and lower the longer-term income and employment prospects of these workers,” Federal Reserve Chairman Ben Bernanke said in a Wednesday speech.”
…

I would take a small issue with that view. Longer-term income prospects are eroded; for many, though, it will be because they’ve had a long stretch of unemployment, not because they can’t get back into the game and eventually be earning what they would have anyhow. Plus, it will take a bit of time to “catch up” to that earning potential (they’ll get it at a later age than the would have normally).

Where I have a big issue is with “skills”. Sure, they may ‘erode’, but most people pick the back up quickly once employed (or receive training that puts them past where they were).

This, I think, is the bigger problem for us right now:

At the same time, government revenues have fallen as Social Security, payroll and other tax receipts have shriveled with fewer jobs and lower earnings. That’s contributed to massive fiscal problems in many states. California already owes the federal government about $7 billion for unemployment-benefit loans and is getting deeper in the hole by the week.