Obama, Top Companies to Help Long-Term Unemployed

Vice President Joe Biden and House Speaker John Boehner of Ohio listen as President Barack Obama gives his State of the Union address on Capitol Hill in Washington, Tuesday Jan. 28, 2014. (AP Photo/Charles Dharapak)
Vice President Joe Biden and House Speaker John Boehner of Ohio listen as President Barack Obama gives his State of the Union address on Capitol Hill in Washington, Tuesday Jan. 28, 2014. (AP Photo/Charles Dharapak)

By Freddie Allen
NNPA Washington Correspondent

WASHINGTON (NNPA) – Keeping his promise to act with or without a cooperative Congress, President Obama recently announced plans to work with business leaders to tackle crippling long-term unemployment that disproportionately impacts African Americans.

Even though Blacks make up roughly 13 percent of the population in the United States, they account for 23 percent of Americans unemployed for more than six months. Whites makes up 63 percent of the U.S. population and 51 percent of the long-term unemployed.

The Economic Policy Institute, a non-partisan think tank based in Washington, D.C., estimated that 12.7 percent of the population went without a job at some point during 2013. According to EPI, nearly 20 percent of Black workers fell into that group.

Heidi Shierholz, an economist with EPI, wrote on the group’s website that: “Given unemployment projections for 2014, it is likely that 17.4 percent of black workers will be unemployed at some point this year.”

Shierholz continued: “The labor market is improving extremely slowly for all major groups, but the employment situation of African Americans remains at something more akin to depression-level conditions.”

On a call with reporters to discuss President Obama’s plan to target the long-term unemployment crisis, Gene Sperling, the director of the National Economic Council, said that the administration is working to address “the potential stigmatization of people merely for the sake that they are long-term unemployed and the negative cycle that it creates.”

Last week, the White House issued a report on long-term unemployment citing a study that illustrated the implicit bias that shadows the long-term unemployed as they search for jobs.

For the study the University of Toronto, University of Chicago and McGill University researchers applied for job listings in sales, customer service, and administrative support using 12,000 fake resumes, only changing the employment status of the applicants.

When the period of unemployment listed on the resume stretched beyond eight months, the study found that the chances of an applicant getting a call back decreased by 45 percent.

“When people are unemployed for a year or two years they often lose their health, they often lose their house, they sometimes lose their spouse, and many of them never recover their earning potential for the rest of their lives,” said Sperling.

According to the National Bureau of Economic Research, the long-term unemployed find jobs they often earn 5-15 percent less than workers who never lost their jobs.

In a collaborative effort to combat long-term unemployment, the White House outlined a list of “best practices” for hiring to assist major companies in eliminating any barriers to hiring the long-term unemployed.

The “best practices” pledge included steps to ensure advertising didn’t “discourage or discriminate against unemployed individuals” and reviewing guidelines in the recruiting and hiring process to make sure that the opportunities for qualified long-term unemployed applicants are consistent with other applicants. Companies that signed the pledge also committed to casting a “broad net” to make sure that the long-term unemployed understood that they would get a fair shot at a job.

Sperling said that if people feel like that they still have a fair shot at getting a job and companies are communicating that they are willing to give long-term unemployed applicants a fair shot that it would be a net win for the country, a net win for growth, and a net win for the U.S. labor force.

Sperling said that 21 of the 50 largest companies in the United States and 47 of the Fortune 200 companies have committed to following the “best practices.” General Motors, Apple, and Walmart, Best Buy, Bank of America, eBay and The Gap clothing company have signed the pledge.

“Many companies and CEOs recognize that this is the right thing to do for people who are our neighbors and friends,” said Sperling. “But it’s also the smart thing to do for the future of our labor market.”

And President Obama is also using his executive power to spur economic growth through a new program at the Labor Department that will provide $150 million in new grant opportunities for businesses and “workforce intermediaries” focused on getting the long-term unemployed back to work through “job-training, subsidized employment and sector-based strategies.”

During his speech on long-term unemployment at the White House, President Obama said that he’s working with business leaders and community stakeholders to help nearly 4 million long-term unemployed Americans find good jobs.

“We’re going to keep encouraging employers to welcome all applicants.  You never know who is going to have the next great idea to grow your business,” said President Obama. “We’re going to keep building new ladders of opportunity for every American to climb into the middle class.” He added, “It’s good for our economy, but it’s also good for our people.”


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