Rising Stakes of Job Loss
Publication Date: May 2005
Publisher(s): Economic Policy Institute
No one wants to lose his or her job. Families face grave difficulties when a worker is jobless, especially for an extended period. Workers receiving unemployment insurance (UI) benefits receive less than 40% of their prior wages. Typically, after six months out of work, the worker has exhausted unemployment benefits and has significantly or completely depleted savings. It is at this point that unemployment can have lasting effects such as elevated levels of debt, diminished retirement and savings accounts (tapped to meet daily expenses), or relocation from secure housing and communities to unfamiliar places in order to find employment.
Recent research has examined how unrelenting high rates of long-term unemployment were spawned by the lack of job creation that followed the 2001 recession. In this report, we examine this unprecedented period of long-term unemployment and compare it with the most recent economic downturn of the 1990s. We conclude that a different picture of long unemployment spells has emerged.