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January 10, 2014

Unemployment Will Only Get Worse

Joe Charlebois

If you think the United States is in a true recovery, think again. The Obama Administration is considering extending long-term unemployment benefits once again, this time for another 26 weeks.


The Emergency Unemployment Compensation program expired on December 28th and lawmakers on both sides of the aisle are likely to support its extension.


According to the Bureau of Labor Statistics (BLS), December 6, 2013, report, the number of unemployed whose length of unemployment exceeded 26 weeks skyrocketed. Even though the number of beneficiaries has declined in the past three years, the most likely reason is the fact that they exhausted their benefits and fell off the roles. In this December report four million Americans where considered to be the long-term unemployed.


The long-term unemployed – who used to account for one-tenth to one-quarter of all listed as unemployed – have remained extremely high under the Obama Administrations enforcement of the ARRA (American Recovery and Reinvestment Act of 2009). Currently 36% of those considered unemployed are long-term recipients.


The Bureau of Labor Statistics also shows that the current unemployment numbers may be improving, but it belies the real unemployment numbers. The BLS releases every month what is called the U-6 numbers. Under the Alternative measures of labor underutilization chart, the BLS breaks down unemployment six different ways. The final measurement is called U-6 – which includes “Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons – as a percent of the civilian labor force plus all persons marginally attached to the labor force.” In essence December’s numbers reflect a still disturbing 13.2 percent of Americans are unemployed, underemployed or have just lost hope.


Also hidden behind the numbers of the 7% unemployment rate is the fact that only 58.6% of the American population is currently working. Typically, following a recessionary period, the percent will climb back up, but The American Recovery and Reinvestment Act of 2009 has done little to aid in this effort. Even in the last two recessions, the lowest percentage of working Americans dipped no lower than 61 percent.


Of course, one of the many issues that the unemployed and underemployed face is the fact that they compete with millions of illegal aliens for not only starting level jobs but skilled trades as well. The pro-illegal left and the National Chamber of Commerce on the right both have reasons to maintain the status quo, but neither will benefit the overall health of the economy.


Creating an amnesty or similar program would only encourage more to come to America illegally to seek their fortune. This would only further erode the existing workforce to a point where entry level jobs would become obsolete for Americans.


The president and 14 Democrat governors – led by Gov. Martin O’Malley of Maryland – are urging an extension of unemployment benefits once again. Even if passed, and even if the GOP gets offsets to cover the bill, it will do little to motivate individuals to find work. It will only delay action.


There are opportunities available for those seeking employment. They may not be in one’s field or may be “beneath” them, but there are opportunities aplenty.


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