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Study: Cutting Jobless Benefits Sees People Look for Work Less, Not More Study: Cutting Jobless Benefits Sees People Look for Work Less, Not More

Study: Cutting Jobless Benefits Sees People Look for Work Less, Not More

by Cord Jefferson
March 22, 2011


A new study (PDF) by Princeton professor Alan Krueger and Stockholm University professor Andreas Mueller says that long-term unemployed people in the United States suffer depressive symptoms and are less likely to seek a job the longer they're out of work. Though this may seem obvious, especially to the unemployed, you'd be surprised: Republican lawmakers have tried in the past to cut unemployment benefits short, saying they're "too much of an allure" to stay jobless.

Now hard data disagrees. Consider this first chart.

Those different colored lines represent different groups, or "cohorts," in the study. As you can see, in every group surveyed, as unemployment endures the time spent searching for a job drops drastically. This is due in large part to the fact that people looking for work—and not finding it—get discouraged and stop trying. (By the way, if you're curious about why all the groups start at around the same level regardless of how long they've been unemployed for, check out the study itself—so are the authors.)

Which leads us to this second chart.


Plainly and simply, this chart flies directly in the face of the claim that unemployment benefits result in a jobless class that needs to be taken off the dole to get motivated. That red line represents the point at which unemployment benefits expire. On the vertical axis is the number of minutes people spend looking for work each day. As you can see, long-term unemployed people spend the same amount of time looking for work throughout the final days of their unemployment insurance. And, when their insurance finally runs out, despite what Republican lawmakers might think, they actually start looking for work less, not more.

One thing not making it any easier on the unemployed is that more and more job applicants are finding that their unemployment actually counts against them in the hiring process. This from a June 2010 CNNMoney.com article:

Some job postings include restrictions such as "unemployed candidates will not be considered" or "must be currently employed." Those explicit limitations have occasionally been removed from listings when an employer or recruiter is questioned by the media though.

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