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Monday, January 24, 2011

The Trend in Long-Term Unemployment and Characteristics of Workers Unemployed for More than 99 Weeks

Gerald Mayer
Analyst in Labor Policy

One of the characteristics of the recession that began in the United States in December 2007 and officially ended in June 2009 was the unprecedented rise in long-term unemployment. The longterm unemployed are usually defined as workers who have been unemployed for more than six months. But, many workers have been looking for work for more than a year, or for more than 99 weeks. Workers who have been unemployed for more than 99 weeks are defined here as the “very long-term unemployed.”

On December 16, 2010, President Barack Obama signed P.L. 111-312, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, which reauthorizes the Emergency Unemployment Compensation (EUC) program for 13 months (to January 3, 2012). In some states with high unemployment, unemployed workers may receive up to 99 weeks of unemployment compensation (UC) benefits. Issues for Congress include whether to authorize the EUC program beyond January 3, 2012, and whether to provide the very long-term unemployed with more than 99 weeks of UC benefits.

As the national unemployment rate rose during and after the recent recession, so did long-term unemployment rates (i.e., the number of long-term unemployed divided by the size of the labor force). From December 2007 to October 2010, the unemployment rate for persons unemployed for more than 99 weeks rose from 0.1% to 1.0%. Although the estimate may not be precise, in October 2010 there were an estimated 1.4 million very long-term unemployed.

An analysis of differences in the share of the unemployed who are very long-term unemployed (i.e., the number of long-term unemployed divided by the number of unemployed) shows that from October 2009 to September 2010, 
  • unemployed men were as likely as unemployed women to be out of work for more than 99 weeks (7.9% and 7.6%, respectively); 
  • among the unemployed, older workers were more likely than younger workers to be out of work for more than 99 weeks (10.7% of unemployed workers ages 45 and older, compared to 6.0% of unemployed workers under the age of 35); 
  • married unemployed workers were more likely than unemployed workers who have never been married to be out of work for more than 99 weeks (8.1% and 7.1%, respectively); 
  • unemployed workers at all educational levels were equally likely to have been looking for work for more than 99 weeks; and 
  • unemployed black workers were more likely than unemployed white workers to have been unemployed for more than 99 weeks (9.9% and 7.3%, respectively); on the other hand, unemployed Hispanic workers were less likely than unemployed non-Hispanic workers to have been unemployed for more than 99 weeks (7.0% and 8.0%, respectively). 
Whether the number of very long-term unemployed workers will rise or fall during the last two months of 2010 and beyond may depend on several factors. The number of monthly layoffs appears to have returned to the same level as before the recession. But, employment and the number of monthly job openings have not returned to their pre-recession levels. In addition, workers who have been unemployed the longest are often the last to be hired after a recession.

Date of Report: December 20, 2010
Number of Pages: 31
Order Number: R41559
Price: $29.95

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