Author: Andrew Berger-Gross
The Great Recession resulted in widespread long-term unemployment, a phenomenon unseen in our country for more than 60 years. The number of jobseekers without work for 27 or more weeks surged during this period; the long-term unemployment rate hit 4.4 percent in April 2010, by far the highest since the Current Population Survey started estimating unemployment in 1948.
The federal government has recently stepped up its support for services for the long-term unemployed. This population is thought to face several barriers to gainful employment, such as difficulties with job search and discrimination by employers. There is some debate about whether these structural problems are intractable — suggesting the need for targeted programs — or the long-term unemployed will eventually find work as the overall economy continues to improve. But there is more agreement — and urgency — regarding the struggles faced by unemployed workers and their families, who may face negative ill-effects long after their initial job loss.
North Carolina suffered through an unusually large and persistent long-term unemployment problem after the Recession. However, the pool of long-term unemployed has dwindled as economic growth in the state has kicked into gear. The state’s long-term unemployment rate has recovered 63 percent of the ground lost since 2010, an improvement that closely parallels the overall state unemployment rate (which has recovered 67 percent.)
The Current Population Survey (CPS) follows up with respondents for several months after their first interview, allowing us to track what is happening to the long-term unemployed in North Carolina from month to month. We can see that more workers have exited long-term unemployed status every year since 2009, while the number of workers entering long-term unemployment has declined since 2012.
However, this does not necessarily mean that the long-term unemployed are landing jobs. A closer examination reveals that they have been more likely to leave the workforce (i.e., stop looking for work) than to find a job in recent years, despite improved labor market conditions. Although labor force exit rates declined slightly and job-finding rates increased somewhat in the past year, these data suggest that long-term unemployed workers in North Carolina may continue to face obstacles to re-employment.
Unfortunately there are limits to what we can deduce from this particular data source. The CPS only follows individual workers for a short period; it does not follow individuals who migrate elsewhere, and the number of North Carolina households covered by the survey is relatively small. Workforce developers and policymakers need better information about the causes and consequences of long-term unemployment in their states. The development of longitudinal databases that link government data on education and workforce outcomes over time should enable researchers to better track the long-term jobless in their states — and, in doing so, determine the best way to help this at-risk population.
General disclaimers:
The Current Population Survey (CPS) estimates are based on a survey and are subject to sampling and nonsampling error. Note that the state-level CPS estimates are not directly comparable to state-level labor force estimates from the Local Area Unemployment Statistics (LAUS) program due to differences in methodology. Any mistakes in data management, analysis, or presentation are the author’s.