Economic Snapshot | Jobs and Unemployment

Congress Has Never Allowed Unemployment Insurance Extensions To Expire With Long-Term Unemployment So High

Four and a half years after the official end of the Great Recession, there is still a gap in the labor market of nearly 8 million jobs. With job opportunities so weak for so long, workers have gotten stuck in unemployment for unprecedented lengths of time. The share of the workforce that is long-term unemployed is nearly twice as high today as it was in any other period when Congress allowed an extended benefits program to expire.

The figure shows the share of the labor force that has been unemployed for more than six months. In the Great Recession, that share rose to more than two-thirds higher than the previous record set during the downturn of the early 1980s. It has since come down significantly, but it is still above the previous record. Today’s long-term unemployment crisis is no mystery; it is exactly what we would expect given how long our labor market has been as weak as it has. It is not the fault of individual unemployed workers failing to exert enough effort or flexibility in their job search.

Last month, the extensions of unemployment insurance benefits passed by Congress during and in the aftermath of the Great Recession were allowed to expire. The figure marks the date unemployment insurance extensions were allowed to expire following prior recessions. Allowing extensions to expire when the labor market is still so weak is unprecedented in the context of previous unemployment insurance extensions in downturns prior to the Great Recession. Without further delay, the Senate should pass, as introduced, the bill to renew federal unemployment insurance through March 31, 2014, and the House should take up and pass legislation to renew extended benefits as soon as possible. This is no time for Congress to turn its back on the long-term unemployed.

Tomorrow, EPI will release a full report analyzing the state of the U.S. labor market six years after the onset of the Great Recession.

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