(CNSNews.com) – The Organization for Economic Cooperation and Development, a international group of economists based in France, says the slow economic recovery and record long-term unemployment in the United States may lead to chronic “structural” unemployment – the type of unemployment that is always present and immune to periods of boom or bust.
OECD economists, in a new report, blamed two factors for the persistently-high, long-term unemployment in the U.S. — poorly designed government benefits and a poor economic recovery.
“The increased duration (of high unemployment) reflects the slow recovery and may also owe, in part, to the lengthened eligibility period for unemployment benefits,” the report said.
In other words, a lack of available jobs for those laid-off during the recession and extraordinarily generous government benefits combine to keep people out of the labor force and even encourage some to leave for good.
The group also called for reforms to federal disability assistance payments, citing the fact that many long-term unemployed have claimed to be disabled in order to receive further federal benefits. OECD criticized the federal government for allowing this to happen, saying that it could lead to greater long-term unemployment.
Read More at CNS News. By Matt Cover.
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The longer someone is allowed to remain unemployed by providing benefits while out of a job does not encourage one to find a job. Simple math: Why work when I get paid not working?
Length of benefit provisions should be based on one factor: Time unemployed. The longer unemployed, the less benefits you get over time. A smaller income each month will encourage someone to take a job before the amount gets to zero.