by Calculated Risk on 12/02/2010 03:15:00 PM

An important article from Catherine Rampell at the NY Times: Persistence of Long-Term Unemployment Tests U.S.. A short excerpt:

New data from the Labor Department, provided to The New York Times, shows that people out of work fewer than five weeks are more than three times as likely to find a job in the coming month than people who have been out of work for over a year, with a re-employment rate of 30.7 percent versus 8.7 percent, respectively.

Likewise, previous economic studies, many based on Europe’s job market struggles, have shown that people who become disconnected from the work force have more trouble getting hired, probably because of some combination of stigma, discouragement and deterioration of their skills.

This is why it is critical to help the unemployed. Rampell writes:

Direct employment programs — like the public works projects of the New Deal era and World War II — might be the fastest way to put people back to work, economists say. But those raise concerns of crowding out businesses and displacing other workers. Besides, such proposals, which smack of socialism to some, seem politically unfeasible at the moment.

If structured correctly - in an environment with a 9.6% unemployment rate - the "crowding out" would be minimal. As far as the politics - well, I support a direct hiring program - and I have no expectation of it happening.