When Tim Zaneske lost his information technology job in June 2009, he never dreamed that he would be unemployed for months and months and months.
Today, nearly two years later, the Flushing Township, Mich., resident is still looking for permanent work. His lengthy job search has taken its toll, forcing the father of two young children to file for bankruptcy. Last month, Zaneske finally got some relief: a part-time contract job.
“You get job leads, but nine times out of 10, it’s nothing,” the 44-year-old said. “It’s beyond frustrating.”
Last year, 36 percent of Michigan’s 590,000 unemployed workers had been searching for a job for a year or longer, according to the U.S. Bureau of Labor Statistics. That was the third-highest rate in the country, behind only New Jersey and Georgia.
Though the state’s job market is improving, economists expect long-term unemployment to remain a huge problem because it will take years to recoup the millions of jobs that were lost during the recession.
The grim outlook comes amid cutbacks for job retraining programs such as Michigan’s No Worker Left Behind. “You have an economy without a lot of safety nets,” said Diane Swonk, chief economist at Mesirow Financial.
The Great Recession may officially be over, but it has left behind a huge problem: hundreds of thousands of workers who have been unable to find a job for almost two years or longer.
In Michigan alone, 150,000 residents this year are expected to run out of their unemployment benefits, which last an unprecedented 99 weeks. That’s on top of the 91,287 that have already done so, according to state and federal data.
Though economists warn the problem isn’t likely to go away anytime soon, policies to help the long-term unemployed — such as additional weeks of jobless benefits or a federal job creation program — face an uphill battle given the current anti-spending mood in Congress.
“Long-term unemployment is going to be a persistent problem,” said Heidi Shierholz, a labor market economist at the Economic Policy Institute. She found that there are no jobs available for four out of every five unemployed workers.
Experts at the Brookings Institution predict that it could take at least five years for the nation to create the more than 12 million jobs needed to return to pre-recession employment levels while absorbing the 125,000 people who enter the labor force each month.
The federal government does not keep track of how many people nationwide have exhausted 99 weeks of unemployment benefits. But a December report from the Congressional Research Service estimates that as of last October, there were 1.4 million of these so-called 99ers.
Diane Swonk, chief economist at Mesirow Financial, said that with no short-term solution in sight, the situation is likely to create a number of negative effects, such as increased welfare and disability payments as 99ers struggle to survive.
“Once you hit 99 weeks, the chances that you are going to re-enter the labor force is pretty slim,” she said.
Long-term joblessness is particularly acute in Michigan, one of the states hit hardest by the recession.
The average duration of unemployment in Michigan last year was 40 weeks, according to Bruce Weaver, economic manager at the Michigan Bureau of Labor Market Information.
Michigan’s unemployment rate dropped to 10.4 percent in February, down three percentage points from the February 2010 rate of 13.5 percent.
For many residents like Tim Zaneske, searching for a job has become an endless, weary struggle. When the domestic auto industry nearly collapsed in 2008, Zaneske lost his engineering support job. A month later, he got a new position teaching engineers how to use software at a company in Troy, Mich.
But 16 months later, in June 2009, the Flushing Township resident was once again laid off. He sent out resumes, networked with friends, went to job fairs and made sure he was on LinkedIn.com, a social media network popular with employers.
Yet months and months passed, with Zaneske getting only two interviews, neither of which led to job offers. The father of two tapped into his 401(k) retirement plan and tried to do as much freelance consulting work as he could get. After more than a year of unemployment, he wound up having to file for bankruptcy.
Last month, Zaneske finally landed an information technology contract job in Fenton that he said he hopes will turn into a full-time position. So far, he has been working anywhere from one to four days a week.
“This was a curveball for sure,” Zaneske said of his lengthy job search. “It really isn’t something you can prepare yourself for.”
The situation has been so frustrating that it has caused him to wonder, “Am I done at 44? Is nobody going to want to hire me?”
To help people like Zaneske, advocates for the long-term unemployed are pushing for more federal assistance. Last month, a bill that would provide 14 weeks of emergency unemployment benefits to workers that have exhausted all of their jobless benefits was introduced in the U.S. House. The additional benefits could cost up to $16 billion, a tough sell amid the fervor in Washington to cut costs.
Some labor market experts, including Timothy Bartik, a senior economist at the W.E. Upjohn Institute for Employment Research in Kalamazoo, say they believe that the federal government should establish a temporary job creation program.
Bartik said hundreds of thousands of unemployed workers could be put to work performing public service jobs at small nonprofit organizations, doing everything from repairing schools and renovating parks to cleaning up abandoned properties.
Long-term joblessness can damage a country’s long-run economic productivity, Bartik warned. And it’s no secret that people who are out of work for long periods usually experience a number of negative effects, including a decline in job skills, reduced self-confidence and mental and physical health problems.
“A lot of economists believe long-term unemployment can permanently reduce the productive capacity of some people,” Bartik said. “It’s not in the interest of society to throw away that long-term productive capacity.”
Source: McClatchy-Tribune Information Services.