Long-term unemployment: consequences and solutions

Article Highlights

  • 39.3% of all unemployed have been unemployed for 6 months or longer

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  • We need to think outside the box for policy solutions to long-term unemployment

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  • long-term unemployment has large impacts on finances and wellbeing

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Chairman Brady, Vice Chair Klobuchar, and Members of the Committee, thank you for inviting me to appear today to discuss the problem of long-term unemployment.   In the testimony that follows, I will discuss the current status of the long-term unemployment crisis, review recent attempts to explain it, and then turn to possible policy options.

I.    Long-term unemployment today

In December 2007, at the start of the Great Recession, the number of the long-term unemployed stood at 1.3 million, or 17.3 percent of all unemployed workers. Over the course of the recession the U.S. experienced an increase in the number of individuals unemployed for 27 weeks or more, a trend which continued after the recession’s close in June 2009. The number of the long-term unemployed peaked in April 2010 at 6.7 million, making up 43.9 percent of all unemployed workers. Currently, there are 4.6 million workers who are considered long-term unemployed, which comprises 39.3 percent of all unemployed workers.

Click here to read the full testimony as a PDF.

 

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About the Author

 

Kevin A.
Hassett
  • Kevin A. Hassett is the State Farm James Q. Wilson Chair in American Politics and Culture at the American Enterprise Institute (AEI). He is also a resident scholar and AEI's director of economic policy studies.



    Before joining AEI, Hassett was a senior economist at the Board of Governors of the Federal Reserve System and an associate professor of economics and finance at Columbia (University) Business School. He served as a policy consultant to the US Department of the Treasury during the George H. W. Bush and Bill Clinton administrations.

    Hassett has also been an economic adviser to presidential candidates since 2000, when he became the chief economic adviser to Senator John McCain during that year's presidential primaries. He served as an economic adviser to the George W. Bush 2004 presidential campaign, a senior economic adviser to the McCain 2008 presidential campaign, and an economic adviser to the Mitt Romney 2012 presidential campaign.

    Hassett is the author or editor of many books, among them "Rethinking Competitiveness" (2012), "Toward Fundamental Tax Reform" (2005), "Bubbleology: The New Science of Stock Market Winners and Losers" (2002), and "Inequality and Tax Policy" (2001). He is also a columnist for National Review and has written for Bloomberg.

    Hassett frequently appears on Bloomberg radio and TV, CNBC, CNN, Fox News Channel, NPR, and "PBS NewsHour," among others. He is also often quoted by, and his opinion pieces have been published in, the Los Angeles Times, The New York Times, The Wall Street Journal, and The Washington Post.

    Hassett has a Ph.D. in economics from the University of Pennsylvania and a B.A. in economics from Swarthmore College.

  • Phone: 202-862-7157
    Email: khassett@aei.org
  • Assistant Info

    Name: Emma Bennett
    Phone: 202-862-5862
    Email: emma.bennett@aei.org

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