6 myths about the unemployed

Posted: 9 December 2012 in Uncategorized
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One of my former colleagues, Teresa Ghilarducci, and Rick McGahey explode five myths about the unemployed.

1. People who receive unemployment benefits are slow to search for work.

Four years ago, Congress created a temporary program of emergency federal benefits that supplements the state benefits. The federal program has been extended several times. As a result, 24 states with the highest unemployment rates had paid up to 99 weeks of benefits. That was scaled back to 79 weeks in the last reauthorization. Five states have been offering 60 weeks, with the remainder falling in between.

The federal program is set to expire again at the end of the year. The last time Congress extended benefits, the unemployment rate increased by one-tenth of 1 percent, but not because people stopped looking for work. The opposite happened: The long-term unemployed continued looking for work so they could continue to qualify for benefits. The extension worked just as it was intended, inducing people to search for jobs.

2. Americans without jobs are hurt by immigrant labor.

In 2010, 30 House Republicans claimed a “direct link between unemployment and illegal immigration” in forming what they called the Reclaim American Jobs Caucus. But most economists disagree with that claim. They say immigrants boost the population and labor force, making it possible to establish more businesses and sell more goods and services, which in turn require more workers.

3. Older workers are clinging to their jobs, hurting jobless younger Americans.

What hurts young Americans is adult unemployment. The effect of chronic joblessness is generational: Children of the unemployed get less education and have more trouble finding jobs when they enter the workforce.

Getting rid of older workers who want to continue working isn’t a solution to joblessness. It guarantees a less diverse workforce and puts more stress on the nation’s retirement systems.

4. Onerous regulations cause jobs to disappear.

Sure, tighter regulations on carbon emissions will affect the coal and oil industries, but those same rules bring jobs in wind and solar plants. Jobs aren’t necessarily destroyed — they are moved around.

5. Discouraged workers drop out of the labor force and never return.

A discouraged worker is someone who isn’t looking for work because he or she thinks no jobs are available. Like everyone else, when the economy improves, more of them look for jobs again. Their active job searches paradoxically can raise the unemployment rate for a while, even though the economy is improving. This is because discouraged workers are not considered part of the labor force, while those looking for jobs are counted as “unemployed.”

And let me add one more:

6. We have to wait around until private employers are ready to hire more labor.

There are many alternatives to waiting until corporations choose to employ more workers. One is to offer unemployment benefits to workers who band together and start their own worker-owned enterprises. Another is for the government to directly hire millions of unemployed, underemployed, and discouraged workers—and have them create goods and services the country desperately needs.

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