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Shrinking labor force masks deepening unemployment crisis

Michele Walker lost her job working for a rental management company in the Pittsburgh area in the spring of 2008. She had held a job for the past 21 years, and figured that she, her husband and her adult son would be fine till she could find work again. “Back then, I even thought about getting a part-time job, and cutting back,” she says, sighing. But then her husband was laid off, followed by her son. Her and her husband’s unemployment checks did not meet their fixed expenses, and so they spent their savings over the course of the next two years, drawing down their 401(k) plans and even dropping their health insurance.
This spring, the checks stopped coming entirely.
Their situation became more dire, and they started cutting back — turning off the air conditioning and heat, keeping most lights off, switching grocery stores, even selling their laptop to use the computer at the library to cut back on the cable bill. Walker has contemplated selling their house — once a dream, now a burden, with the gutters needing to be replaced and the bushes needing to be cut — so they can move in with family in Ohio. No matter how many résumés Walker sent out, no many how many businesses she visited — dozens a month, she says — she never managed to find another permanent position. For now, she is selling handmade birthday cakes and other baked goods for cash, advertising by word of mouth and church flier.
Much of the coverage of the June labor market report released on Friday focused on the drop in the unemployment rate, from 9.7 to 9.5 percent, or the 83,000 private-sector jobs created. But the headline numbers hid the reason for the dip in unemployment: not more jobs, but fewer workers. Walker, like 652,000 others across the country, is jobless and has not looked for a position during the past four weeks — and therefore has officially been reclassified as a “discouraged” worker, a person “marginally attached to the labor force,” rather than an unemployed one.

Read the rest at The Florida Independent.

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