Long-term unemployed still at record levels

LA Times – by Don Lee

It has come down to this for Brian Perry: an apple or banana for lunch, Red Sox ballgames on an old Zenith TV and long walks to shake off the blues.

At 57, Perry has been unemployed and looking for work for nearly seven years, ever since that winter when the Great Recession hit and he was laid off from his job as a law firm clerk.  

By his count, Perry has applied for more than 1,300 openings and has had some 30 interviews, the last one a good two years ago. With his savings running dry, this summer he put up for sale his one asset — a three-bedroom house his parents used to own in this suburb of Providence.

“I’m not looking for pity, just one last opportunity,” said Perry, a boyish-looking man with bright blue eyes and a nasal New England brogue.

The national economy, now in its sixth year of recovery, is gaining momentum and the unemployment rate has fallen sharply over the last year to 6.1%. But the number and share of people out of work for more than six months, the so-called long-term unemployed, remain at historically high levels.

Of the 3 million long-term jobless today, about one-third have been unemployed for more than two years, Labor Department data show. A small minority — roughly 100,000 Americans like Perry — have been actively looking for at least five years.

They might be called the super long-term unemployed. While others have quit looking, taken early retirement or entered disability rolls, these workers have pressed on year after year despite the increasingly long odds of finding a new job.

Extreme as their cases are, they reflect the devastating effects of the worst economic downturn in 75 years and how much the risks of being unemployed for extended periods have increased compared with the past.

The longer people remain jobless, the more likely they are to suffer the scarring effects of unemployment that can hurt their earnings permanently and create a cycle of instability.

Even as some get re-employed, research shows that many find themselves unemployed again before long. From 2008 to 2012, only 1 in 10 long-term unemployed person in a given month had returned to steady, full-time work a year later, according to a study by Princeton University economists.

Although relatively few workers are in this boat, experts call the problem deeply worrisome.

“Just because you aren’t long-term unemployed doesn’t mean you won’t be tomorrow,” said Justin Wolfers, a senior fellow at the Peterson Institute for International Economics.

Having large numbers of people drawing food stamps, Medicaid and other public programs instead of being productive, taxpaying workers hurts the overall economy, he said. “The budgetary impact is quite large.”

In many ways, Perry typifies the long-term unemployed. Like him, a disproportionately large share are single. Perry also belongs to a group of older workers that has suffered the biggest increase in long-term unemployment in recent years.

Perry has a two-year associate’s degree in liberal studies, and it turns out that jobless workers with that level of schooling have the longest duration of unemployment among all education groups, according to Labor Department statistics.

“It might be that folks with associate degrees are skilled enough that they won’t take just any job, and spend more time looking for something better,” said Georgetown University economist Harry Holzer. At the same time, he said, employers “may not believe their skills are high enough for what they need in many cases.”

f from his $15-an-hour clerical job in January 2008, a month after the official start of the Great Recession. He remembers that afternoon vividly: He came back to the office after lunch and “was told to leave now or at the end of the day,” Perry said. He left immediately, hurt by the way he was dismissed after 15 years on the job.

He took with him vacation pay and a few weeks of severance, adding that to hefty savings that he had amassed over the years. He wouldn’t say how much, only that it was in the five figures.

He had braced for a tough job hunt, especially given that Rhode Island’s unemployment rate has consistently run much higher than the nation’s. It was last at 7.7%, the highest after Mississippi’s.

His first application was with the Biltmore Hotel in downtown Providence; his last with Brown University, where he eyed an opening for a storeroom attendant. In between, Perry has emailed and sent out resumes to companies in practically every industry.

He’s written about his plight to politicians, including President Obama, whose office replied twice with standard letters starting “Dear Friend.”

The president has sought to help long-term jobless by enlisting some 300 companies to sign a pledge that they would review their hiring practices to make sure they are not unfairly screening out or otherwise discriminating against people who have been out of work for many months.

Jeff Zients, director of the National Economic Council and assistant to Obama for economic policy, said the companies are living up to their promise. “We’ll have data to show their progress soon.”

But Perry said his long unemployment continues to be seen by some employers as a big black mark on his forehead.

Sometimes, Perry avoided thinking about the heap of rejections by gorging on junk food and soda, even as he stopped eating out and cutting back on other spending. His weight climbed to 220 pounds — until Feb. 10.

That afternoon, while talking with a neighbor in the backyard, Perry was sweating and breathing heavily. His neighbor called 911, and Perry spent the next four days in the hospital, where cardiologists put in a stent, later followed by three more. It didn’t cost him a penny because it was covered by the state’s healthcare program for those who can’t afford it.

Since then, Perry has followed a strict diet. He lost 40 pounds and his waist shrank from 48 to 40 inches. Now when he gets stressed or discouraged, Perry said, he walks for an hour or two around his working-class neighborhood.

Perry doesn’t remember the last major purchase that he made; his biggest living expense, apart from $555 a month for an $85,000 mortgage, is $120 a month for Internet, telephone and TV.

He doesn’t own a car or a cellphone. In winter, he keeps the thermostat at 63 degrees. Still, Perry said, he has drawn down his savings to four digits, so two months ago he listed his colonial-style house for $299,000.

Perry has lived in Rhode Island his entire life and wants to stay. But if he can’t find a job soon, he said, he’s prepared to move to someplace warm like Florida, where he won’t have to worry about heating bills.

“That’s one big plus,” he said with a laugh. “You know how expensive it is to heat a house.”
don.lee@latimes.com

Times staff writer Christi Parsons contributed to this report.

http://www.latimes.com/business/la-fi-longterm-jobless-20140910-story.html#page=1