By Ezra Klein
Pew's new report on long-term unemployment is sobering stuff:
Thirty percent of those who are jobless have been unemployed a year or more (long-term unemployment) as of December 2010. Equaling 4.2 million people -- roughly the population of Kentucky -- this is 25 percent more people affected by long-term unemployment than a year prior (December 2009, 3.4 million)....Using the CPS data, Pew calculated that the persistent problem of long-term unemployment is occurring across education and age groups but those who are older than 55 are most likely to remain jobless for a year or more. Additionally, a high level of education only provides limited protection against long-term unemployment -- the rates are similar across degree attainment: 31 percent of unemployed workers with a bachelor’s degree have been out of work for a year or more, compared to 36 percent of high school graduates and 33 percent of high school drop-outs.
The interplay between age and unemployment really worries me. On some level, we have a rosy view of "structural unemployment": It's a guy in Reno, Nev., who has skills better suited to the job market in Boulder, Colo. That's not an easy problem to fix -- our Reno resident doesn't scan Boulder's "help wanted" ads -- but it at least points toward a way the problem can be fixed. But a lot of older workers have found that employers just don't want to hire them. They are, in the words of one job-seeker in Warren County, N.J., "too young not to work, but to old to work." Or, more to the point, too old to get a job. When they apply for jobs much below their previous position, they're rejected as overqualified. When they try to hold the line, employers default to younger workers. And in both cases, there's a quiet assumption that young workers will be better at learning new skills than older workers will be.
Eventually, the unemployment rate in this country will come down. But it's very likely that there'll still be a core of a couple of million hardcore unemployed -- people who're a bit older, who're underwater on their houses in an area with a weak labor market, and who are becoming less employable as both their age and their time out of work come to seem more and more glaring on their resumes. What are we going to do for them?