Field Notes: Opportunities for the Unemployed

A report by the Council on Foreign Relations compares worker’s support programs in the United States to the rest of the G7 countries.

The Council on Foreign Relations recently published their latest Renewing America infographic scorecard illustrating how the United States compares to the Group of Seven Nations on unemployment, labor participation rate, and resources and opportunities available to the unemployed since the year 2000. Long-term unemployment can create difficulty for the unemploye, and when they are rehired, it is often at a lower wage.  Unemployment assistance programs have the ability to minimize unemployment and support economic recovery through skill-building, education, and apprenticeship programs to keep workers' abilities aligned with industry demands. In the full text of the report, the CFR describes the United States Federal Worker-Assistance Policy as "insufficient and unequal" in how its system fails to "provide adequate assistance for eligible Americans, and distributes its limited resources unequally across many programs." Juxtaposing the United States with countries like Germany and Norway not only shows the differences in how each country handles workers' assistance, but also can act as a possible model of reform:

Today many companies are reluctant to hire because of growing international and domestic competitive pressures. This forces many unemployed workers to leave the industries in which they have spent their entire careers. The United States’ federal worker-assistance system—the collection of federal programs designed to help job seekers—does not adequately address this new kind of unemployment. It is particularly unable to cope with the massive spike in long-term unemployment brought on by the Great Recession. The U.S. system is also fragmented, consisting of several large programs accessible to any American and many smaller programs that provide services to narrow groups. A 2011 Government Accountability Office (GAO) report identified forty-seven employment and training programs spread across nine federal agencies. But these programs often lack sufficient resources to help qualified workers. Additionally, some programs—such as assistance for workers displaced by increased foreign trade—offer greater income support and easier access to training than others, resulting in resource inequality among the unemployed.

Ineffective worker-assistance policies undermine economic recovery, lead to skills shortages for employers, and hurt U.S. competitiveness. Other advanced economies invest more in worker assistance and use innovative programs to minimize unemployment. Apprenticeships, which play a large role in some countries, have helped reduce long-term unemployment among younger workers. These countries successfully mitigated the worst consequences of the Great Recession through effective worker-assistance policies, positioning their workforces for long-term growth.

The graph below shows the discrepancy between the United States and the rest of the G7 countries on government-sponsored resources and programs for helping the unemployed to find jobs.



  The infographic below illustrates how the Worker Investment Act does not accommodate the majority of the unemployed in the United States.



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