The latest effort from David Leonhardt is a disquisition on who the unemployed are -- particularly, that the brunt of unemployment has been concentrated on a small "pool of jobless workers" who have stayed without work for some time, even as wages rise for the rest of workers. The data leads to an observation from Felix Salmon:
Maybe we really are all middle class now: there's the unemployed at the bottom of the pile, and the plutocratic elite at the top, with the overwhelming majority sitting in between, doing OK but hardly great. ... The problem is that persistent unemployment at or around 10% is unacceptable in the U.S., especially with the social safety net being much weaker here than it is in Europe.
However, we haven't seen much evidence that long-term unemployment is "unacceptable." In fact, judging by the response of most policy-makers in Washington, unemployment at this rate has been pretty much accepted. True, the Obama administration has been hectoring Congress for more policies to encourage economic and jobs growth, but a reluctance to act on the part of the Fed and the Senate demonstrate that many policy-makers are accepting the status quo and hoping for the best.
This is scary for one key reason: At the current pace, we are not likely to create enough new jobs to keep up with the pace of population growth -- to do that, we need to create 120,000 new jobs a month. We didn't do that last month, something we have not been able to consistently achieve over the last several months. That means we can expect the core of long-term unemployed to grow, setting up a political conflict between those who are able to accept the status quo of unemployment -- and those who very literally cannot.
-- Tim Fernholz
