Economix Blog: Rings of Unemployment

CATHERINE RAMPELL

Dollars to doughnuts.

Four out of five Americans know relatives or family friends who were laid off during the last few years or were laid off themselves, as I reported in an article on a new report from the Heldrich Center for Workforce Development at Rutgers University.

Heldrich Center for Workforce Development, Rutgers University Note: Respondents counted only once using the innermost social circle for those knowing more than one person. Those counted in outer rings did not report knowing anyone from the inner rings.

In a January survey, the Heldrich Center asked Americans about their exposure to layoffs in the recession or its aftermath. A lot of respondents knew several people who had been laid off, but the researchers decided to segment responses by greatest proximity.

They found that:

• 23 percent lost a job themselves;

• among those not touched so far, another 11 percent said someone in their household had lost a job;

• another 26 percent said a member of their extended family had lost a job;

• another 13 percent said a close personal friend had lost a job;

• if not touched by any of the conditions so far, another 5 percent said a close personal friend of someone else in the household had lost a job; and

• the remaining 21 percent of respondents answered “no” to all these questions.

The findings were especially striking because unemployment has been unusually concentrated during the last few years, relative to previous downturns.

Usually a lot of people churn in and out of unemployment during a recession. In the wake of the recent financial crisis, however, the layoffs were large but appeared more targeted, with people being very unlikely to cycle back into a job once displaced — hence the record lengths of unemployment duration for those who did lose their jobs.

These new Heldrich data suggest that a lot more people were exposed to layoffs through friends and family. This is seen in other areas of the survey, too; for example, 4 in 10 respondents said they lent money to family or friends in the last few years. (Three in 10 said they were on the other side of this transaction, meaning they borrowed money from family or friends.)

Article source: http://economix.blogs.nytimes.com/2013/02/07/rings-of-unemployment/?partner=rss&emc=rss