Can you rebuild your life after being jobless?

Unemployment in America

We're told that the world is coming out of recessions, that things are improving and there are jobs out there, yet for many people life hasn't returned to normal, things are still a struggle and they don't know where the end is in sight. A record 44 percent of the nation's 15 million unemployed have now been out out of work for at least six months, many of these 6.5 million people it's reported, will never manage to completely rebuild their working lives.

Never since the Great Depression has the US labor market seen anything like it. The previous high in long-term unemployment was 26 percent in June 1983, just after the deep downturn of the early 1980s. The 44 percent rate in March translates into more than 6.5 million people, The LA Times reports.

Nearly two-thirds of these workers have been jobless for a year or longer, new Labor Department reports show. Of those unemployed, a huge majority are older workers, of those unemployed four out of 10 of those out of work for more than six months are 45 or older.

"Particularly concerned"

On Wednesday, Federal Reserve Chairman Ben Bernanke told the congressional Joint Economic Committee that he was "particularly concerned" about the huge number of long-term unemployed.

"Long periods without work erode individuals' skills and hurt future employment prospects," he said.

"Younger workers may be particularly adversely affected if a weak labor market prevents them from finding a first job or from gaining important work experience."

Bernanke also reiterated his recent comments that the economy is in the midst of a "moderate" recovery from the recession and that the country needs to address soaring budget deficits.

The efforts to help the economy as well as help those unemployed workers are straining the nation's finances. In normal times, jobless workers can qualify for up to 26 weeks of state unemployment benefits, but the severe economic crisis in the last two years has prompted Washington to help fund jobless benefits for up to 99 weeks in high-unemployment states, including California and Florida.

Federal spending on unemployment benefits could reach $168 billion this year, five times the level in the years just before the recession, according to a report by Pew Charitable Trusts. In addition, tens of billions of dollars more are being spent on food assistance for unemployed workers and their families.

At the same time, government revenues have fallen as Social Security, payroll and other tax receipts have shriveled with fewer jobs and lower earnings. That has contributed to massive fiscal problems in many states.

Losing and creating jobs

During the recession, more than eight million jobs were cut, this is on top of the roughly seven million people who were jobless before it began in 2007.

The economy needs to create around 125,000 jobs per month just to keep pace with the population growth, and the recovery isn't expected this year to produce anywhere near the several hundred thousand jobs that are needed monthly to make a significant dent in the unemployment rate, currently at 9.7 percent.

The problem has another, less direct effect as well, because many of the long-term unemployed are older workers, some have little choice but to retire earlier than planned. This means more people will be drawing Social Security and Medicare, and fewer will be contributing to those programs through payroll taxes.

As in previous downturns, a large share of the long-term unemployed are in manufacturing and construction.

But most of today's workers who have been jobless for 27 weeks or more are in sales, office and other service industry jobs, including more than one million in management and professional occupations.

Jodie Humphries

Jodie Humphries graduated from Bath Spa University with a BA Hons in Creative Writing in 2008. She has worked for GDS Publishing for the digital group since July 2009. She has previous experience with writing for the web, running her own website since April 2007.

Like this article? Get the RSS feed: