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Down and Out: Measuring Long-term Hardship in the Labor Market

Author

Listed:
  • John Schmitt
  • Janelle Jones

Abstract

The official concept of “long-term unemployment,” while useful, is incomplete and, in some cases, even potentially misleading. As tracked by government statistics, the long-term unemployed are only a relatively small part of the population facing extended, sometimes permanent, spells without work. This report proposes rethinking our understanding of long-term unemployment in two ways. First, we encourage shifting from a narrow focus on long-term unemployment toward a broader concept of “long-term hardship” in the labor market. Many workers or potential workers who do not fit the official definition of long-term unemployment – including “discouraged” and “marginally attached” workers and those involuntarily working part-time jobs – face long-term hardship in the labor market, but are not captured in the standard measure of long-term unemployment. Second, we suggest complementing the standard measure of long-term unemployment, which reports the share of the unemployed who have been out of work for 6 months or more, with an alternative measure, which reports the share of the total labor force that has been unemployed for 6 months or more. This alternative measure avoids some counter-intuitive properties of the standard statistic and is better for making comparisons across demographic groups.

Suggested Citation

  • John Schmitt & Janelle Jones, 2012. "Down and Out: Measuring Long-term Hardship in the Labor Market," CEPR Reports and Issue Briefs 2012-01, Center for Economic and Policy Research (CEPR).
  • Handle: RePEc:epo:papers:2012-01
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    More about this item

    Keywords

    unemployment; long-term unemployment; discouraged workers; marginally attached workers; part time for economic reasons;

    JEL classification:

    • J - Labor and Demographic Economics
    • J0 - Labor and Demographic Economics - - General
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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