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It's the middle of November and Congress is facing two big decisions: Extending George Bush's tax cuts, and extending unemployment benefits for just some of the almost one in ten American workers who haven't been able to earn enough, or any, income for months on end. Welcome to the holiday season — the first since the Great Depression when so many Americans have been out of work for so long. If congress doesn't act by November 30th, emergency unemployment benefits will expire for almost 3 million Americans by next year. There are enough votes to approve in the House. But in the Senate, it only takes 40 to stand in the way. That's 40 out of 57 Democrats, 2 Independents, and 41 Republican Senators; many of the latter who have had the audacity to say we can't afford these benefits, while demanding even more costly tax breaks for millionaires. We must ratchet up pressure for a Senate vote, to make sure anyone who refuses to help Americans in need has to stand before all of us and own it. Unlike tax cuts for the rich, these benefits — $300 a week to workers who haven't been able to work for more than 6 months — immediately help the economy because it is money that will be spent. But if the benefits expire, as they did this summer at the hands of obstructionist Republicans and corporatist Democrats, our economy takes a hit.1 The Senate has the power to act — without concessions or caving on tax cuts — and should because it's the right thing for our country. Even more so during the holidays. They have the time to act, too — but barely. There are only 5 more days of sessions before these benefits expire. Today, groups across the country are demanding that the Senate take action. Join the call and build pressure on your Senators by sending a fax to their offices. Thank you, Elijah Zarlin, Campaign Manager CREDO Action from Working Assets Life On The Sidelines: The Long-Term Unemployed Mark Ralston/AFP People search for jobs in an employment office in El Centro, Calif. More than 6 million people in the U.S. have been out of work for six months or longer. But, there's another statistic that gets less attention — the number of people who have been unemployed for six months or more — the long-term unemployed. This number is at levels not seen since the Great Depression. What happens when workers — and the skills they embody — are sidelined for so long? Being out of work for more than six months isn't for the faint of heart. "I really think that if people aren't going through this right now, they don't get it," says Shelia Egan, a 47-year-old single mother who has been out of work for more than a year. "They don't see how difficult it really is." Egan sold pharmaceuticals for a big European firm for 11 years and earned a six-figure salary. Prior to that, she had applied for only five jobs during her career. "And of those five jobs, I got four of them," she says. "And it has been very jarring to apply for a job that asks for one or two years [of] experience, [and] you have 10 and you don't even get a call." Of course, Egan is not alone. Over 40 percent of the unemployed — more than 6 million Americans — have been out of work for than six months or longer, according to the Bureau of Labor Statistics. Long-Term Unemployment Trends, 2005-2010The number and percentage of people who have been unemployed for more than six months has risen sharply since 2008. "Every Wednesday morning, this room would fill with these incredibly talented, motivated, optimistic people," Egan says. "And I would just sit and look around the table and think, I cannot believe these people don't have jobs. And week after week they would come back and I would just be stunned at the amount of talent sitting in this room, unemployed." A Lesson From Europe Jacob Kirkegaard, a research fellow at the Peterson Institute for International Economics, has studied the effects of long-term unemployment in Europe. It became a huge problem there in the 1980s and 1990s because more than half of all jobless workers were experiencing long-term unemployment during that period. "The wasted human capital is just tremendous," Kirkegaard says. "Once people become unemployed for long periods of time, you start seeing a serious depreciation or reduction in their skill levels — in the human capital that they carry." That happens in several ways, he says. One is when people are forced to look for jobs outside of their current field. "If you shift from being an autoworker to being a nurse, you basically lose all the human capital that you embodied as a skilled autoworker," Kirkegaard says. A Drag On The Economy Now, if that unemployed autoworker became a skilled nurse, that could be a good thing. But in the current situation, when large numbers of people are being forced to trade down from high-skilled jobs, the sidelining of their old skills becomes a big drag on the economy. And even if people stay in their current occupation, skills can atrophy after a worker is unemployed for long periods, Kirkegaard says. "They essentially lose contact with the latest developments in their own field," he says. Egan worries she's falling behind on news about medical developments, which could hurt her chances of being rehired as a pharmaceutical sales rep. "Especially when you're looking at medical and scientific journals, they often times require a subscription, or a pretty hefty annual fee," she says. Accepting Lower Pay Those are expenses Egan can't afford right now. She is resigned to the prospect that even if she does land another job selling pharmaceuticals, it'll be at lower pay. Of course, it's not just individuals that suffer when valuable human capital is lost or sidelined. "It is a tremendous drag on overall economic growth," Kirkegaard says. "There's no doubt about that." Europe demonstrated that in the 1980s and 1990s, when high levels of long-term unemployment meant it grew slower than the United States. Retraining Workers Kirkegaard warns that the level of long-term unemployment in the U.S. is unlikely to fall back to pre-crisis levels anytime soon, so the U.S. must do more to keep skill levels high for those workers. That means spending much more on effective retraining, he says. "If there's one thing where it is sensible for the government to have a bigger deficit in the short term in order to avoid long-term lower economic growth, it is in combating long-term unemployment," Kirkegaard says. He says the federal government has had the right idea, putting more money into community colleges recently. But that has been offset by cuts at the state and local levels during this deep downturn. Now, with controlling deficits on the front burner politically, finding money for retraining to protect the nation's human capital will be a challenge. http://www.npr.org/2010/11/12/131279568/life-on-the-sidelines-the-long-term-unemployed&sc=nl&cc=nh-20101115  The Skills Gap: Holding Back The Labor MarketTo Fill Job Skills, Firm Brings Training In HouseA metal-parts business started a training school to ensure it has a good supply of workers. The Skills Gap: Holding Back The Labor MarketEmployers Pickier About Job Applicants' SkillsEmployers have a new demand these days: They want to hire people who can hit the ground running. The Skills Gap: Holding Back The Labor MarketThe Housing Dilemma: It's Holding Workers BackThe inability to sell, rent or refinance a home could become one of workers' biggest obstacles. | |||||||||||||||||
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