Recession Nightmare: From Unemployed to Unemployable

From the FiscalTimes.com: 

...The key question for policymakers is how this labor market is different.

... many economists are starting to fear that the U.S. may never return to the days of 5 percent or less unemployment. That’s because the long-term jobless are losing their skills and their employment connections, and are drifting further away from the labor force. The most effective policy in that case would be retraining for the unemployed and education geared toward growth industries, especially at a time when ever-greater global competition is reshaping the U.S. industry.

People are less likely to move from unemployment to employment the longer they are out of work. Of people who have been jobless for more than 12 months, only about 1 in 10 have returned to work, while about 90 percent have either remained unemployed or dropped out of the labor force, according to a Labor Dept. study.

Since the recession began, the labor force participation rate, defined as the percentage of the population aged 16 and over who are employed or seeking work, has fallen by the most in post-war history to levels not seen since the early 1980s.

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Link: http://www.thefiscaltimes.com/Columns/2011/10/10/Recession-Nightmare-From-Unemployed-to-Unemployable.aspx?p=1