Even as the unemployment rate has slowly ticked down in recent months as the economy has regained all of the jobs it lost since President Obama took office, long-term unemployment remains a persistent problem. More than 40 percent of the unemployed have been out of work for at least six months, and according to a new report from the Pew Fiscal Analysis Initiative, about 30 percent of the unemployed have been out of work for at least a year:
The challenge of long-term unemployment has persisted, even as the overall unemployment rate has continued to improve. According to Pew analysis of Current Population Survey (CPS) data from the BLS, the percentage of jobless workers who had been unemployed for a year or more reached a peak of 31.8 percent in the third quarter of 2011. Despite modest improvement in the first quarter of 2012, the rate of long-term unemployment among the jobless remained stubbornly high. In fact, it was more than triple the 9.5 percent rate that it was in the first quarter of 2008, the first quarter of the Great Recession.
Studies have shown that there are several negative effects linked to long-term unemployment, including loss of lifetime earnings and lower earnings for the children of workers who are out of work for so long. One study even found that the long-term unemployed gradually lose important skills, including their level of literacy. Long-term unemployment also decreases life expectancy.