According to a just released report by the BLS, the average unemployed American looked for a job for about 5 months, or 20 weeks, before giving up in 2010. This is a two and a half times extension in the period of disenchantment over the past 3 years, when it took just 8.5 week for the unemployed to give up as recently as 2007. Gradually the feeling of entitlement in America's labor pool seems to be deflating. Alas, it also means that the labor force participation, which continues to be at a 25 year low, will likely not return to recent highs as more and more people are now unemployed for longer, and thus lose marketable employment skills, meaning that the current jump in unemployment is, as many have feared, entirely structural and there is nothing cyclical about it. Additionally, the lucky unemployed succeeded in finding a job in about 10 weeks in 2010, a doubling from 2007's median 5 week period of successful job searching. The issue however is that in May 6.2 million had been out of work for more than six months and more than 4 million haven’t work in more than a year. These are people who are now effectively pushed out of the labor force. Bottom line: perhaps the Fed should just give up on its maximum employment mandate which it now appears to be a complete failure, and just focus on generating hyperinflation which alas will soon be the only way out of the complete disaster America will find itself in in under a year when total US debt is about 120% of GDP.
Key part from the BLS:
By the end of 2010, the median number of weeks jobseekers had been unemployed in the month prior to finding work was a little more than 10 weeks. In contrast, prior to the start of the recent recession in 2007, the
median was 5 weeks. Unemployment duration also increased among those who
eventually quit looking and left the labor force. Unemployed
individuals were jobless for about 20 weeks in 2010 before giving up
their job search and leaving the labor force. Whereas in 2007, those who
were not successful in their job search had been unemployed for about
8.5 weeks before leaving the labor force.
The recent recession has had a profound effect on the length of successful job search. The table
shows the distribution of transitions from unemployment to employment
by duration of unemployment (in weeks). From 1994 through 2008, roughly
half of all unemployed jobseekers found jobs within 5 weeks. In 2007,
for example, 49 percent of those who were unemployed in the prior month
and employed in the subsequent month had been jobless for less than 5
weeks. During the same year, less than 3 percent of the unemployed who
found work had been jobless for more than 52 weeks. In stark contrast,
11 percent of transitions from unemployment to employment exceeded a
year in 2010, and only 34 percent lasted less than 5 weeks.
And the two charts which confirm the seriousness of the situation, posted previously on Zero Hedge: