unemployment

Republicans Deny Unemployment Benefits

For all of you about to be denied unemployment and can't find a job, it's time to write your Congressional representatives.

The House of Representatives on Thursday voted down a measure that would have reauthorized extended unemployment insurance for another three months, leaving no clear path forward to prevent the benefits from lapsing as scheduled on Nov. 30.

Without a reauthorization, the Labor Department estimates that two million long-term unemployed will prematurely stop receiving benefits before the end of the year.

"I think it's a sad moment," said Rep. Alan Grayson (D-Fla.) after the vote. "It appalls me that the Republicans keep pitching and pitching and pitching the tax cuts for the rich and won't join in a bill to help people keep their homes and not have to live in their cars."

The bill was brought to the floor under a "suspension of the rules," meaning it required approval from two-thirds of the House. It failed 258 to 154, with mostly Democratic support. Twenty-one Republicans voted in favor and 11 Democrats voted nay.

For all those 99ers going to now be homeless (odds on), check out 2 million people about to be denied unemployment benefits.

Remember this only covers (if they were extended) 48% of the workforce. Most can't even qualify to obtain unemployment benefits due to being self-employed, temporary and so on.

ADP Employment Report for October 2010 - 43000 private sector job gain

ADP's private unemployment report for October is showing +43,000 private sector jobs were gained for the month. Additionally last month's dismal report was revised, for only a -2,000 private sector job loss. ADP is predicting lethargic job gains for the near future. We are too.

Employment gains of this magnitude are not sufficient to lower the unemployment rate.

Unemployment 9.6% for September 2010

The September 2010 monthly unemployment figures are out. The official unemployment rate stayed the same at 9.6% and the total jobs lost were -95,000. -159,000 government jobs were lost and private sector jobs increased by +64,000, with 16,900 of those jobs being temporary. -77,000 of the government jobs lost were temporary Census jobs. U6, or the broader unemployment measurement, jumped up to 17.1%.

IMF - Global Employment Crisis

The schizophrenic IMF has declared the world has a global jobs crisis:

AMERICA and Europe face the worst jobs crisis since the 1930s and risk ''an explosion of social unrest'', the International Monetary Fund has warned.

''The labour market is in dire straits. The Great Recession has left behind a wasteland of unemployment,'' said IMF chief Dominique Strauss-Kahn at an Oslo jobs summit with the International Labour Federation.

A joint IMF-ILO report said 30 million jobs had been lost since the crisis, three-quarters in richer economies. Global unemployment has reached 210 million. ''The Great Recession has left gaping wounds. High and long-lasting unemployment represents a risk to the stability of existing democracies,'' it said.

The study cited evidence that victims of recession in their early 20s suffer lifetime damage and lose faith in public institutions. A new twist is an apparent decline in the ''employment intensity of growth'' as rebounding output requires fewer extra workers. As such, it may be hard to re-absorb those laid off even if recovery gathers pace. The world must create 45 million jobs a year for the next decade to tread water.

How does this square the IMF demanding austerity measures, gutting employment benefits, wages and security? It doesn't.

A Decade of High Unemployment

If this isn't a definition of a Depression, I just don't know what is. Carmen Reinhart, University of Maryland Economist, is projecting a decade of high unemployment:

Ms. Reinhart’s paper drew upon research she conducted with the Harvard economist Kenneth S. Rogoff for their book “This Time Is Different: Eight Centuries of Financial Folly,” published last year by Princeton University Press. Her husband, Vincent R. Reinhart, a former director of monetary affairs at the Fed, was the co-author of the paper.

The Reinharts examined 15 severe financial crises since World War II as well as the worldwide economic contractions that followed the 1929 stock market crash, the 1973 oil shock and the 2007 implosion of the subprime mortgage market.

In the decade following the crises, growth rates were significantly lower and unemployment rates were significantly higher. Housing prices took years to recover, and it took about seven years on average for households and companies to reduce their debts and restore their balance sheets. In general, the crises were preceded by decade-long expansions of credit and borrowing, and were followed by lengthy periods of retrenchment that lasted nearly as long.

“Large destabilizing events, such as those analyzed here, evidently produce changes in the performance of key macroeconomic indicators over the longer term, well after the upheaval of the crisis is over,” Ms. Reinhart wrote.

Raiding retirement just to survive

It appears especially the middle aged, you know those ones who desperately need a job and are denied, are raiding their 401ks. From Fidelity Investments Q2 2010 statistics on 401k, retirement accounts:

the percentage of participants either initiating a loan or a hardship withdrawal increased. Loans initiated over the past 12 months grew to 11% of total active participants from about 9% one year prior. The portion of participants with loans outstanding also increased two full percentage points in the second quarter to 22%. The average initial loan amount as of the end of the second quarter was $8,650 with an average loan duration of three and half years.

Frankly I thought this number would be much higher, for we have horrific stories of people posting online their suicide notes. Maybe it is because those who are going homeless already blew past any retirement savings. Regardless, a sign of the times and this is only people who have retirement savings to tap into.

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