Study: Recovery eludes long-term unemployed

More than 20% of Americans laid off the past five years are still unemployed and one in four who found work is in a temporary job, according to a survey out Monday.

The report underscores that despite a sharp drop in long-term unemployment recently, many people out of work at least six months are still struggling to recoup their former wages and lifestyles. Those idled for years face an even tougher road back to employment.

"While the worst effects of the Great Recession are over for most Americans, the brutal realities of diminished living standards endure for the 3 million American workers who remain jobless years after they were laid off," says Carl Van Horn, director of the Heldrich Center for Workforce Development at Rutgers University.

The center conducted the survey of 1,153 Americans, about 300 of them long-term unemployed, from July 24 to Aug. 3.

The ranks of the long-term unemployed have fallen by 31% the past year to 3 million. But many of those hired are in temporary or part-time slots, or full-time positions that pay less than their previous salaries.

Forty-three percent of all the unemployed people surveyed were looking for part-time work over the summer, while only 26% sought full-time jobs, a reversal of the findings from the center's previous survey in January 2013.

"I think it's a reflection of the work available to them," Van Horn says. "The labor market is changing." Many employers have converted full-time jobs to part-time or temporary ones to increase efficiency and cut costs.

Workers fortunate enough to land full-time jobs often take significant pay cuts. Forty-six percent of those who found jobs after being laid off said their new job pays less than their previous one.

The financial hardship is greatest for those struggling with long-term unemployment. More than four in 10 sold possessions to make ends meet. More than a fifth moved in with friends or family. And nearly a third missed a mortgage or rent payment.

Nearly half of those out of work at least six months during the past five years estimate it will take three to 10 years to recover financially from the recession.

Despite their struggles, many of the chronically jobless do not benefit from government assistance, the survey shows. Just 38% are receiving unemployment insurance, and 83% of those who did get benefits lost them before finding another job. Last December, the federal government cut off benefits beyond the 26 weeks provided by states.

Most of those laid off during and after the recession received no other government assistance. Twenty-eight percent of the long-term unemployed get food stamps, the survey shows. But just 9% get help looking for a job and 4% are enrolled in a government-funded training program.

"The programs are not well-funded and a lot of people are not aware of them," Van Horn says.