The Atlantic published an article about the problem of long-term unemployed. Apparently there is something magical about being 6 months unemployed such that a person becomes almost unemployable from that point on.
The author concludes with a policy prescription:
It’s time for the government to start hiring the long-term unemployed. Or, at the least, start giving employers tax incentives to hire the long-term unemployed. The worst possible outcome for all of us is if the long-term unemployed become unemployable. That would permanently reduce our productive capacity.
The government should start hiring the long-term unemployed – I’m trying to figure out if that is a serious proposal? The author leaves the implementation details up to the reader to imagine, so let’s imagine them:
What work will they do? Will these be fulfilling jobs? If not, why not? If so, who in the world would ever take an unfulfilling job in the private sector if all you have to do is wait 6 months and become entitled to a fulfilling job working for the government?
How long will the job last? Will it be short term or long term? If short term, it’s hard to see how that is going to “trick” private sector employers into looking at the participants’ resume again. Hiring manager thought process: “I see you were unemployed for 6 months, then employed by the government for 6 months, and now you’re unemployed again. Remind me: why am I more likely to hire you now?” If long term then how will we ever afford this, and why would anyone, once hired, ever look for work in the private sector or anywhere else?
How will the participants be selected? I can envision a couple of options:
1) Everyone gets hired – so this is a true, new entitlement. Anyone and everyone who is unemployed for more than 6 months gets hired by the government.
2) Political process – people unemployed greater than 6 months get hired according to who has a friend or family member working for the “Department of Long-Term Unemployed”. Although, if you had a friend working for such a department wouldn’t you have an in for one of our existing government jobs?
3) Merit-based process – the government will review the resumes and hire only the best and brightest of the long-term unemployed. Because I’m sure the government is better at picking out those diamonds in the rough than 6 months worth of private sector resume reviewers.
4) Lottery – random draw for government jobs! Woo hoo!
Note that (2), (3), and (4) don’t solve the problem which this program was initially designed to solve, which is “the long-term unemployed become unemployable [and] permanently reduce our productive capacity” – it just reduces the number by a few.
How will these new employees be organized? Will we set up a new organization in the government, with some hired as managers, and others worker bees? Will we hire one executive long term unemployed per one hundred worker bees? Or are we going to just randomly plug these people into existing government organizations? If there were a match with their skills to the mission of the organization they probably would have already been hired. The point was that we are hiring them as an entitlement so it doesn’t matter what their skills are at all.
I’m not questioning that employers discriminate against long-term unemployed, and agree that it is a problem for the macro economy, and especially for the individuals who cannot find work. However, starting a government program to hire the long-term unemployed is a not a solution.