Right now, there are 14 million American workers officially unemployed.*
Jared Bernstein suggests a different way of looking at the stock of jobless workers, in terms of flows into joblessness.
Here are the 3 flows:
- Employment to unemployment: lose your job, start looking for a new one.
- Out of the labor force to unemployment: you never had a job or for awhile gave up looking for a job but you’re now actively seeking a job
- Unemployment to unemployment: you continue to be without a job but haven’t yet given up looking even though, on average, you’ve been out of work for over 40 weeks
Bernstein’s view is that employers should be given a tax credit for hiring more workers—and unemployment compensation should be extended. He also admits the tax credit may not work.
Of course, the credit won’t help much if demand is so weak that employers simply won’t hire, even if we make it cheaper for them. Here again, more direct hiring programs, like FAST! can help.
The unemployment situation is so bad right now that even the path that will not be taken—Jan Schakowsky’s “Emergency Jobs to Restore the American Dream Act”—promises only to slow the flow, by creating 2.2 million jobs and decreasing the unemployment rate by 1.3 percent.
* The number is almost twice that, if we include those who are discouraged and/or working part-time jobs because full-time jobs are not available.
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