A recent study by Princeton University authors Alan Krueger, Judd Kramer, and David Cho, published by the Brookings Institute, argues that the vast majority of the ranks of the long-term unemployed (out of work for at least six months) won’t work again. The study’s key finding was that only 11 percent of the long-term unemployed since the recession have found work.
This statistic is in stark contrast to those found during earlier post-recession periods. So pronounced is this new phenomenon that economists have developed a new category for unemployment status called “no longer looking for work.” This group represents a population segment that may never work again. They include economically marginalized populations who have given up their job search after extended periods of searching.
“Despite declining over the last four years, the share of the unemployed who have been out of work for more than six months still exceeds its previous peak, reached in 1981-82, and is well above its average in the last recovery,” summarized Brookings.
“Yet, measures of short-term unemployment are close to their average rates in the last recovery. As a result, overall unemployment remains elevated because of the large number of people who have been unemployed long term.”
Of the long-term unemployed, 36 percent last worked in sales and service jobs and 28 percent held blue-collar jobs.