NC State Economist Dr. Mike Walden – Another Positive Sign for the Job Market
There’s a little more optimism about the employment situation today as we are seeing businesses adding positions and jobless rates trending down. However, one of the scary statistics for the job market has been the length of time folks have been out of work. Are we seeing any progress here? N.C. State University economist Mike Walden answers.
“We are. … And you mention it was a scary statistic. It really is. The average length of unemployment reached 41 weeks last year — double the length that we saw in the previous three recessions. Again, this means someone who’s out of work, on average, they’re out of work almost an entire year.
“But finally we’ve seen a decline in that number. For the past six months, it has been on a downward trend. It’s now approaching 35 weeks. So obviously this is still too high, but at least it’s going in the right direction, and economists are encouraged by this. I think they are encouraged by the fact that it is going down. It is showing signs of a better job market.
“On the other hand, unfortunately we don’t see that number going down anytime soon to the normal pre-recessionary level — that is, the level that we normally saw during times of economic expansion of 16 weeks. I don’t know of any economist predicting that level being reached anytime soon.
“And I think the problem that we have is that, unfortunately, many of our unemployed simply don’t have up to date skills. So, even though they want to work, and even when there were jobs out there, there’s just not that match between the skills that the unemployed have and the skills that are needed in the workplace. Obviously, this is going to be a big, big challenge for the economy in years ahead.”