Economist and former Secretary of Labor Robert Reich says unemployment in the U.S. will most likely remain high for the next 10 years.
"At the current rate of job growth (averaging 90,000 new jobs per month over the last six months), 14 million Americans will remain permanently unemployed," Reich writes in his blog.
He adds that the consensus estimate is that at least 90,000 new jobs are needed just to keep up with the growth of the labor force.
"Even if we get back to a normal rate of 200,000 new jobs per month, unemployment will stay high for at least 10 years," says Reich, now a professor of public policy at the University of California at Berkeley.
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"Years of high unemployment will likely result in a vicious cycle, as relatively lower spending by the middle-class further slows job growth," making political compromise even more elusive than it is now.
In past years, says Reich, politics has been greased by the expectation of better times to come – not only more personal consumption but also upward mobility through good schools, access to college, better jobs, improved infrastructure.
(Associated Press photo)
"It’s been a virtuous cycle: When the economy grows, the wealthy more easily accept a smaller share of the gains because they still came out ahead of where they were before. And everyone more willingly pays taxes to finance public provision because they share in the overall economic gains," he says.
"Now the grease is gone," says Reich, who served in three national administrations and was a secretary of labor under President Bill Clinton.
"Fully two-thirds of Americans recently polled by the Wall Street Journal say they aren’t confident life for their children’s generation will be better than it’s been for them."
"The last time our hopes for a better life were dashed so profoundly was during the Great Depression."
According to the Wall Street Journal, the Bureau of Labor Statistics reported recently that the U.S. jobless rate remains a dreadful 9 percent overall, but oil and gas production, which now employs some 440,000 workers, has experienced an 80 percent increase, or 200,000 more jobs, since 2003.
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