Fed Report: Unemployment Benefits May Prolong Unemployment
Kevin Glass | Jul 09, 2014

The authors of the report, Maria Canon and Yang Liu, write:

In summary, we find that the extension of unemployment benefits affected the labor market status of long-term unemployed workers in late 2013. Without extended UI benefits, these unemployed workers would have been more likely to be employed, more likely to exit the labor force, and on average 1.9 percent less likely to remain unemployed in the following period. In short, our simulated early termination of the EUC program lowered the unemployment rate by 3 to 5 basis points, suggesting that the December 2013 expiration of the EUC program might have slightly lowered the unemployment rate in early 2014.



more here

complete report

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First of all I have no faith in the BLS U-3 numbers for unemployment! Any statistic that demonstrates a lower unemployment rate as prople stop looking for work is deceiving  and bogus. While the U-6 rate is higher, it also depends on the U-3 rate.

I don't know who did that chart, but there is no point of reference for time. Sloppy work.

Look at table 1 in the complete report, it at least has a time line and some data that will send chills down your spine!

It is reasonable to assume that many people will remain unemployed as long as the federal government is will to pay them to stay home. It makes you wonder how many of the 92+ million of unemployed workers would remain unemployed if the benefits were stopped. Better yet, how many of those 92+million would be able to even find work!

You will find we have been saying that for years.   That benefits over 6 months will only prolong unemployment.

Quote from: walkstall on July 10, 2014, 06:30:50 AM
You will find we have been saying that for years.   That benefits over 6 months will only prolong unemployment.

Funny how conservatism always ends up being right  Make it comfortably to be poor and people will be poor, subsidies poverty and you get more poverty, reduce the incentives to work and people will work less...