How to Save the Long-Term Unemployed
The Atlantic - 04/25/2013
Something happens when you’ve been out of work for half a year. Employers ignore you completely. That was the conclusion of a new field study by Rand Ghayad, a visiting scholar at the Boston Fed and a PhD candidate at Northeastern University, that showed that resumes with otherwise identical qualifications get called back far less if they list six months of unemployment. As Matt Yglesias points out, the problem is this kind of statistical discrimination against the long-term unemployed is pretty rational. Companies with a big stack of resumes to get through (which is all of them nowadays) will still have more than enough strong candidates left over if they screen out the long-term jobless, who presumably would have gotten a job before if they themselves were strong candidates. Now, this heuristic makes sense, but it makes less sense in the aftermath of the worst crisis in 80 years — and much less sense on a macro level. After all, it makes us collectively poorer if the long-term unemployed become unemployable.