For over the last 18 months, the Center for Working-Class Studies has been publishing the “De Facto Unemployment Rate” (DFUR). The DFUR includes all those who are officially unemployed, those looking for work, the underemployed, disabled or in early retirement, and those receiving government work subsides. It also estimates those who are in prison or have joined the military because they can’t find work in the private sector. The most recent analysis estimates that the DFUR continues to hover around 30%.
At first, the DFUR did not receive much attention, perhaps because it differs from the typically reported unemployment rate. But in the last six months, it has been featured in the Manufacturing and Technology News and the Wall Street Journal. More important, the idea of understanding unemployment in broader terms has gained more acceptance as the media has begun to use the Bureau of Labor Statistics’s (BLS) alternative measures of labor underutilization.
In terms of actual job growth, the most recent study by the BLS indicates that almost all employment growth in last six months is due to government jobs, specifically jobs with the U.S. Census. While some have argued that the recession may be over, the lack of private sector job growth indicates that we may be on the brink of another jobless recovery. If the U.S. is to avoid falling back into recession, we must continue to extend unemployment benefits and/or craft another stimulus package.
Yet recent bills to create additional jobs and extend unemployment benefits have met with resistance, and even when such benefits exist, many states make it difficult for those who are out of work to receive any benefits. For example, some states limit benefits for part-timers and those who leave a job for medical reasons or due to the lack of available childcare. A recent study by Economic Policy Institute indicates that less than 67% of the long-term unemployed are receiving benefits. If unemployment benefits had not been extended, only 35% would have been covered.
The high, persistent unemployment rate suggests a long and very slow economic recovery, and we may, in fact, be entering a “jobless era,” as Don Peck wrote in The Atlantic in March. But having a job in the current economy doesn’t necessarily protect workers in this recession. As Jamie Smith Hopkins reported in last week’s Baltimore Sun, 13 percent of employers cut salaries last year, and for many of those workers, their earnings levels may never recover.
But the problems go beyond earnings. Not only do many workers feel anxiety about keeping their jobs, the quality of work is declining. The effects of the recession are being exacerbated by changes in the labor market and organization practices based in economic globalization. Trade liberalization, deregulation, privatization, and reduced welfare programs have led to social and economic insecurity, income inequality, weaker unions, reductions in public sector services, and geographical shifts that have resulted in downsizing, restructuring, irregular work hours, electronic monitoring, and the intensification of work. In turn, these changes have increased job demands, work hours, job insecurity, and control while reducing rewards and social supports making work more precarious. All of this not only contributes to unemployment in the U.S., it also contributes to work-related stress for those who are still working, as Paul Landsbergis of the Center for Social Epidemiology argued in a recent presentation at the How Class Works Conference.
Increasing levels of job-related stress threaten the health of those who are employed. Landsbergis suggested that while the dramatic deaths and illnesses associated with the “accidents” at the Massy coal mine and BP’s off-shore oil rig get national attention, the insidious influence of job stress increases cardiovascular disease, sickness absence, and acute injuries. Psychological and musculoskeletal disorders remain under reported, especially among the working class.
Taken together, the DFUR and the impact of economic change on the workplace remind us of the widespread effects of global and national economic trends. We need to think about both the effects of unemployment and the relationship between current economic policies, work practices, individuals, and health in the modern economy. Globalization doesn’t have to cause unemployment or undermine the quality of work. Government, business, and labor leaders should not wait for an economic recovery to reconsider the impact of globalization on both work and non-work. Any future economic recovery will be more stable and effective if it not only creates new jobs but also places value on what the International Labor Organization calls decent work for all working people.
John Russo, Center for Working-Class Studies