John Wainwright
http://www.economist.com/news/finance-and-economics/21627628-difficulty-people-have-getting-jobs-makes-unemployment-unnecessarily
This article is a discussion on whether or not the location of the nation' s impoverished and unemployed members of the labor force is the reason that they have a longer period of finding work. Often these long stretches of unemployment are chalked up to those who take advantage of welfare or to the fact that workers are simply not qualified for the jobs at hand. THe author reviews the perspective that while jobs are leaving the inner-city, the lower income black population was discriminated against when it came to moving into better neighborhoods or faced discrimination when pursuing jobs in these new areas.
The most tricky part of this equation to work out is whether or not people who live in bad areas had trouble finding jobs because they are from impoverished areas or that they live in bad areas due to not finding jobs. This cause and effect relationship can not be explained via macroeconomics. Discussions like this take place on a case by case basis and can hardly be described numerically. However one such study attempts to do so and is highly lauded by economists. A new paper published by the National Bureau of Economic Research avoids all the issues that have been noted in its contemporary studies. The paper encompasses 250,000 poor Americans in 9 different cities over a period of 6 years. The purpose of this paper was to create an index of accessibility of unemployed workers to the jobs they are seeking. In general the authors of this study found that jobs are moving away from where the unemployed are located, in fact the persons of the study who did not travel far to reach their job took 7% longer to find a new job. One factor that does detract from this study is that crime and poor public education is very prevalent in these areas, deterring people from reaching their workplace potential.
If you worked in the government (local or state) that represents these areas what policies would you seek to push forth and what would you address first?
I think frictional unemployment may be reduced by bringing better information about job openings to workers. Job matching services such as Simply Hired, Monster and Career Builder have made great strides in accomplishing this. In recent years, however, I think the best source for finding new jobs is through social networking. This has been helped by online services such as Facebook, Twitter and LinkedIn.
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