Duration of Unemployment

http://economix.blogs.nytimes.com/2011/03/11/college-grads-high-school-dropouts-and-long-term-unemployment/

It's good to see that Americans' wealth grew 3.8% in the final three months of 2010, boosted by gains in stock portfolios. And, it's good to see that companies have added to their cash stockpiles, which reached their highest point in more than 50 years. At $1.89 trillion, corporate cash is at an all time record level. There are a growing number of economists that see corporations intending to start spending that "cash" on capital investments which, in turn, will potentially increase hiring.

That's the good news.

Today's post on "Economix" (attached) addresses the issue of the long-term unemployed. The normal statistics on unemployment solidly correlate with education: the higher the level achieved, the lower the unemployment rate. But, once unemployed, college educated workers are just as likely to face seemingly interminable unemployment as high school drop outs.

Catherine Rampell asks on that post if we have any theories why. Yes we do. If one were to believe Alan Blinder (at Princeton), the U.S. has jobs that have gone overseas permanently. If it can be done on the computer (or cheaper), it's overseas even if it's at the "professional" level. A tax lawyer is in trouble. A divorce lawyer, not so much. Those required to perform services in person for people are safe.

Rampell's charts are great. She does a good job, as always.