Long-Term Employment Picture Remains Bleak
Even though the most recent numbers show a modest decline in the nation's unemployment rate, two new reports spotlight the disastrous long-term impact the recession has had on employment and on the middle class more broadly.
A briefing paper from the Economic Policy Institute, "The Great Recession's Long Tail," reveals that job losses during this downturn have been far greater than during any other recession since World War II. It could be a decade or more before we return to pre-recession levels of unemployment, the paper notes.
A look at the "underemployment" rate only makes the picture more depressing. This rate, which includes people who have stopped looking for a job or can only find part-time work, is 16.7 percent, or 25 million people. Both unemployment and underemployment rates are much higher among blacks and Hispanics than for whites.
The other recent publication is a special report from the American Prospect and Demos on "America's Endangered Middle Class." It includes a series of essays on topics ranging from the economy and public investment to trade and taxes. A piece by Robert Kuttner, "Champions of the Middle Class," looks at whether organized labor can lead a movement to restore broad economic security.
"The labor movement, seemingly, is the natural counterweight to elite pressures to deregulate, privatize, reduce social outlay, and otherwise leave the middle class at risk," Kuttner writes. The article, which includes comments from AFT president Randi Weingarten, ends with this thought: "It's hard to imagine a middle-class society without a labor movement—but it's hard to imagine organized labor thriving unless labor becomes the credible leader of a movement to reclaim a middle-class America."
Meanwhile, results of the Labor Department's latest employment survey, announced Feb. 4, point to troubling trends in public sector jobs. "One of the biggest trends emerging from the January payroll numbers is a divergence between private sector hiring and public sector firings," Janney Montgomery Scott analyst Guy LeBas told the Wall Street Journal.
Private companies added 50,000 jobs, but local, state and federal governments fell by 14,000. "As state and local governments cut their budgets in 2011," LeBas said, "we estimate as many as 5 percent of the 6.2 million individuals on state and local government payrolls are at risk, equivalent to 315,000 jobs, excluding education." [Dan Gursky, Wall Street Journal]
February 7, 2011