Middle Class Feeling Pain Of Lengthy Jobs Dearth

By Nathaniel Popper

Published March 12, 2004, issue of March 12, 2004.

One number stood out among the disappointing employment statistics for February released last week: The average length of unemployment rose to 20.3 weeks — the highest in two decades.

The lengthening tenure of the unemployed comes as little surprise to Joel Shurkin, a reporter who shared the 1979 Pulitzer Prize for his coverage of the Three Mile Island crisis for the Philadelphia Inquirer. Shurkin has been looking for work through the Jewish Vocational Service of Baltimore since he lost his editing job at Johns Hopkins University last August, a day before his 65th birthday.

“I thought universities never fire anyone,” said Shurkin, who edited a medical Web site run by Johns Hopkins. “It turns out not to be true.”

Shurkin is about to hit another unexpected and unhappy turn in a few weeks, when his unemployment benefits will be cut off — a consequence of Republican moves in December that limited financial aid for the jobless to 27 weeks.

“I have a mortgage, car payments and my daughter in a Solomon Schechter school,” Shurkin said. “When my benefits run out I am going to start doing damage to my future.”

Like Shurkin, many highly educated workers who lost their jobs during the past three years initially thought that their good credentials would get them back to work quickly. But the current economic recovery has broken the old paradigm. A study released March 4 by the Economic Policy Institute and the National Employment Law Project reported that during the past year the long-term unemployed — those who have been out of work for 27 weeks or more — increasingly and disproportionately have come from the white-collar sector, where many Jewish workers, such as Shurkin, are concentrated.

“We’ve had severe long-term unemployment in sectors like manufacturing before, and we kind of got a grip on that,” said Sylvia Allegreto, an economist at the Economic Policy Institute and a co-author of the study. “The difference now is that we’re seeing well-educated people having trouble getting back to work.”

As a result, during these hard times a broadening cross section of the population — including Jewish social-service providers — are tuning in to the debate over how long the federal government should provide the unemployed with financial assistance.

The current 27 weeks afforded by the government is a historical anomaly for times of recession like this. At every other point since World War II when long-term unemployment was as high as it is now, the federal government has provided an additional 13 weeks of emergency benefits to help compensate for the weak job market. This was the case for the first year of this recession, but when the program expired on December 21, Republican leaders in Congress blocked efforts to renew it.

Since then, an estimated 760,000 unemployed workers have stopped receiving benefits. The political establishment has recently taken notice of this situation, and the right to extended unemployment benefits has become one of the most volatile political hot potatoes in the debate over the struggling economy. In the last month, both the House and the Senate held tightly contested votes on the question, revealing significant signs of political reorientation on the issue.

The Republican leadership in both the House and the Senate initially blocked any vote on extending the 13-week benefit program, pointing to the dropping overall unemployment rates and arguing that the program is an emergency one for more dire times. Marvin Kosters, a labor economist at the conservative American Enterprise Institute, argued, “We know that making available additional benefits leads people to take advantage of them by staying unemployed longer.”

But left-leaning labor economists note that since the supplemental program ended in December, the percentage of all the unemployed reaching the 27-week cutoff has increased each month. The figure for February was 22.9%, up from 9.9% in mid-2001.

“The program should be temporary, and it should end,” said Isaac Shapiro, a senior fellow at the Washington-based Center for Budget Policy and Priorities. “But it should end when the labor market is reasonably healthy, and we aren’t at that point yet.”

Recently a growing number of Republicans have come to see the matter in a similar light. At the beginning of February, in a symbolic gesture, the House of Representatives voted 227 to 179 in support of providing the additional 13 weeks of financial assistance to the jobless. More than 39 Republicans crossed party lines to approve the measure, though it did not involve appropriating the funds necessary to revive the supplemental program.

Then, in a February 26 vote that could have provided the funding, the Senate fell two votes shy of the 60 needed to pass a budget appropriation (Democrats John Kerry and John Edwards skipped the vote to campaign for president). Twelve Republican senators supported the measure, including North Carolina Senator Elizabeth Dole, who voted in November against extending the benefits. “There are lots of groups that are reporting to us from North Carolina that there is a real problem with job creation,” a Dole aide said, explaining the senator’s shift. “Cutting off benefits right now would not be the proper course of action.”

Taken together, several observers say, the recent House and Senate votes signaled a substantial realignment on how to deal with what many observers have taken to calling a “jobless recovery.”

“At the time when the program expired, there was more hope that job growth was about to begin in earnest and would be substantial,” Shapiro said. “You got 39 Republicans at the beginning of February — I think you’d get even more today.”

A week before the Senate vote on the benefits, the Bush administration backed away from its “Economic Report of the President,” which had projected the creation of 300,000 jobs a month in 2004. According to figures released March 5 by the Bureau of Labor Statistics, only 21,000 jobs had been created during February, while 392,000 of what labor economists call “discouraged workers” stopped looking for jobs during that month, accounting for an overall contraction in the work force.

For many observers, though, more disconcerting than the overall unemployment figures is the growing number of long-term unemployed, and the new populations falling into this category. The number of experienced workers who are not finding their way back into the work force could, economists say, represent a new phenomenon in the quickly shifting labor markets of the globalized economy.

“The effects of outsourcing are being felt spreading throughout the economy,” said Allegreto of the Economic Policy Institute, “instead of being restricted to low-wage workers.”

The new conditions are no surprise to employment counselors at Jewish Vocational Service offices across the country. “We’re seeing very specific people coming in,” said Claudia Finkel, the chief operating officer of the Jewish Vocational Service of Los Angeles. “The mature worker has not been able to recover at all in this economy. These are the individuals who were the mainstay of our economic stability, and these individuals are not going back to work. There are $8-an-hour jobs, but the higher-level jobs are not coming back.”



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