For years, the problem of long-term unemployment has been vexing to labor experts and particularly to African-Americans. Today, President Obama took a huge step toward solving the issue, convincing nearly half of the nation’s top 50 employers to revamp hiring practices to end discrimination against the long-term unemployed.
White House officials said about 300 businesses have agreed to new hiring policies, including 21 of the nation’s 50 largest companies and 47 of the top 200.
“We know that one of the biggest problems right now in the jobs market is the long-term unemployed,” the president told CNN’s Jake Tapper yesterday. “Folks are looking at that gap in the résumé and they’re weeding them out before these folks even get a chance for an interview.”
In addition to hosting the executives from such companies as McDonald’s, Motorola, eBay, Bank of America and Walgreens, Obama will sign an executive memorandum instructing the federal government to abide by the same practices.
Economists have closely watched the fortunes of the long-term unemployed as the nation’s economy has struggled to recover from the greatest recession in 70 years. Officials said that as unemployment among those out of work for a short time has returned to historical norms, those who have been looking for a long time still have especially high unemployment numbers.
White House officials had to point out that every job that goes to someone who has been out of work for a long time can’t go to someone out of work for a shorter period, so there would be no net gain in employment. But according to officials, one of the primary effects of the president’s initiative would be to keep workers from growing so frustrated that they give up altogether.
Scholars from such schools as Northeastern, Yale and the University of Chicago have conducted studies sending out fictitious resumes to employers and found that those from people out of work for six months or longer rarely got responses.
“There is a negative cycle in long-term unemployment, and that negative cycle comes from the fact that people who stay unemployed for six months or longer face significant disadvantages in the labor market simply on the basis of their status of being long-term unemployed,” Gene B. Sperling, the president’s national economics adviser, said to the New York Times.
Sperling said he showed some of the university studies to the president last year, which prompted the White House to look for ways to fix the problem. When the White House in September began contacting individual companies to join the effort, Sperling sent an email directly to Rupert Murdoch, executive chairman of News Corp., who responded personally with support and directed his companies to take part.
“Many CEOs had just not thought about the issue,” Sperling said.
“Our hope,” he said, “is that this is not the destination or culmination of this, but this will have a larger and more significant impact.”