Unemployment Line Stays Long: Up to 26.4 Million Seek Full-Time Jobs
If you're looking for a full-time job, the good news is you're not alone. That's also the bad news. The 9.7% unemployment rate isn't likely to fall anytime soon, economists say, and the actual number of workers seeking full-time jobs could be poised to grow. In the worst-case scenario, more than 26 million people could be battling each other for a few available jobs.
As it is, more than 40% of the nation's 14.9 million unemployed workers have been out of a job for 27 weeks or more, according to the latest U.S. Bureau of Labor Statistics employment report. The average member of this group has been unemployed for 29.7 weeks -- nearly seven months, with no end in sight. And with each passing week, finding a new job has become harder and harder.
Unemployment is expected to remain above 9% for at least the next two years, according to Christopher Woock, research associate for The Conference Board, and other economists. That's because many of the estimated 4 million jobs lost in the construction and manufacturing industries during the recession may never come back. That's what happened after the 2001 recession in sectors such as data processing, computer and electronics manufacturing, and textile manufacturing.
"A Significant Reallocation of Workers"
What's more, few other industries will likely be in a position to take up the slack from construction and manufacturing and accept large numbers of new workers in the next few years. "We are looking at higher unemployment for several years," Woock says.
Many of the job cuts companies made during the recession may remain permanent unless the economic recovery leads to real expansion, not just the moderate 3% to 4% annual growth that has been projected through 2012. If those job cuts become permanent, that could cause real upheaval in some industries.
"If we have substantial structural change," says Woock, "then that's going to require a significant reallocation of workers across various industries and that is going to make for a very slow and drawn out labor market recovery."
In other words, as industries shift and jobs vanish forever, some workers may be forced to retrain to find work in a different industry.
Uncounted Full-Time Wannabes
Even once hiring does begin to pick up, several types of workers will have to find full-time work before the unemployment rate begins to fall significantly.
The first layer is the estimated 9 million workers who Woock says are working part-time, even though they want full-time work. Employers have been filling full-time schedules with part-time workers until companies feel more confident about their future growth prospects. People in those part-time positions will likely be hired full-time before employers look at other workers.
As those part-time workers are made full-time, the 2.5 million workers who are discouraged and have stopped looking for work -- and as a result don't show up in the unemployment statistics -- will begin returning to the labor market. Add them to the 14.9 million unemployed already counted and the part-timers, and that's at least 26.4 million people potentially looking for work. The nation would need double-digit gross domestic product growth to absorb that many workers.
Readers' Stories
AOL readers' comments about a previous DailyFinance story on long-term unemployment illustrate some of the difficulties employees are having matching their skills to employers' needs in a job market so flooded with applicants (readers' comments are unedited):
Issamarie7 wrote:
I have two degrees my A.A. and B.A., ample experience in management, customer service, and I work at Walmart. I tried to get a second job just to cover my student loan bills and what do you know, turns out I am not qualified to flip burgers or at least that's what the managers at in and out say.
Bernlinwich wrote:
The job market now wants BA degrees or higher. Try getting that on unemployment. I have a degree in Accounting and it hasn't helped me one bit to find a job. BUT then again I'm in the mid 50's bracket and companies don't want you.
AZthairub wrote:
It is finding quality worker that is the problem where 25% of US populations even have trouble filling out their own application form. Many cannot pass even the simple drug test. Finding qualified and competant employees at the right price that a company is willing to pay for is the biggest challenge that plagues many companies with rising healthcare cost and dismal productivity. Now HR can be much more selective on applicants and one will really need to shine in order to get a job.
These comments suggest that with employers in the driver's seat, workers are finding that they may be overqualified for some jobs, may suffer from age discrimination, in some cases, or may just lack the skills and education to obtain other positions.
Where's the Work?
Even when workers are qualified, in the current environment, they're sure to run up against other equally qualified applicants. To make matters worse, the Bureau of Labor Statistics projects that 12.6 million new workers will enter the labor force by 2018. This number includes the millions of college graduates who enter the workforce every year.
But the outlook isn't all bad. Experts predict that at least some new jobs are coming. Where will they come from? Barry Bluestone, dean of the School of Public Policy and Urban Affairs at Northeastern University, predicts that within the next eight years, 2.4 million job vacancies could appear in the U.S. in the education, health care, government and nonprofit sectors.
Jagadeesh Gokhale, an economist at the Cato Institute, says demand from aging baby boomers will drive job growth in health care and other related service industries. He also suggests that jobs may be created wherever shortages of goods and services develop as companies seize the opportunity to fill the unmet demand.
