Nearly 4 million Americans have been unemployed for 27 weeks or longer — trapped in a vicious cycle that makes it harder to get back to work.
The big picture: Long-term unemployment during a pandemic is a double whammy. Millions are experiencing food and housing insecurity and lack health care when they need it most.
What’s happening: “The troubling amount of long-term unemployment and its continuing rise is dangerous for the U.S. labor market,” says Nick Bunker, an economist at the jobs site Indeed. “A fast labor market recovery will help alleviate these concerns, but that bounce back is still a ways away and dependent on controlling the coronavirus.”
- The number of Americans experiencing long-term unemployment — around 4 million — is far from the worst of the Great Recession, when long-term unemployment reached 7 million.
- But it’s remarkable considering where the U.S. was before the pandemic. The long-term unemployment rate is 2.5%, which is comparable to the 3.5% overall unemployment rate in January 2020, Bunker notes.
Why it matters: Studies have shown that long-term unemployment hurts workers’ physical and mental health, reports Bloomberg. And the longer someone is unemployed, the harder it is for that person to get another job — let alone another job at the same pay level.
Job-seeking is even more exhausting during a pandemic, says Tim Classen, an economist at the Quinlan School of Business at Loyola University in Chicago.
- To start, there are fewer jobs out there than there are unemployed people.
- On top of that, people may be attempting to juggle job-hunting with parenting kids who are learning remotely.
- Not everyone is comfortable interviewing over video calls, and not everyone has the broadband access required to even attend those interviews.
“The fluctuations in uncertainty play into this, too,” Classen says. Millions of restaurant workers, flight attendants, retail workers and more aren’t sure when the pandemic will end — or if their employers will even survive it.
There’s a bit of a silver lining, though.
- While losing a job is a traumatic event and can really chip away at someone’s sense of self-worth, it can also be easier to bear if millions are going through the same thing. Job loss doesn’t feel as personal in a pandemic, says Classen.
- “There’s a sense of, ‘Yeah, I’m depressed, and I’ve lost my job, but I’m not alone in my suffering,'” he says. “Maybe in some way that tempers it.”
Dallas-based Baylor Scott & White Health will outsource, lay off or retrain 1,700 employees who work in information technology, billing, revenue cycle management and other support services, according to The Dallas Morning News.
The health system said outsourcing the finance and IT jobs and other support services will help it improve efficiencies and focus on reducing costs in noncore business areas.
About two-thirds of the 1,700 employees will be joining third-party RCM, IT, billing or support staff vendors. About 600 to 650 positions will be eliminated.
Baylor Scott & White said that employees whose positions are being eliminated will be invited to participate in retraining programs.
The retraining program would allow the employees to remain employed at the health system and receive the same pay or higher, depending on their role, according to the report. Some of the retraining programs that will be available are learning to become a certified medical assistant or learning a job in patient support services.
“In no case — in no case — is anyone going to miss a paycheck,” Baylor Scott & White CEO Jim Hinton, told The Dallas Morning News. “We can afford to make these commitments, and we want to do the right thing for the great employees of Baylor, Scott & White. They’ve really done everything we’ve asked and more during this last year.”
This is the third time Baylor Scott & White has announced cost-cutting initiatives related to its workforce since the pandemic began. Last May, 930 Baylor Scott & White employees were laid off, and in December the health system said it would lay off employees and outsource 102 corporate finance jobs.
Mr. Hinton said that Baylor Scott & White has 2,000 clinical positions open, and it is investing in a new regional medical school campus and a joint venture to improve care for the underinsured.
“This is a transition to a new business model, a transition to a new way of working,” Mr. Hinton told The Dallas Morning News.