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Training: A Targeted Policy Proposal - page 5 / 23





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  • 5.

    The increase in the unemployment rate has been especially marked for people with less than a high school diploma (and 25 years or older)—reaching nearly 16 percent in late 2010 and still at nearly 14 percent in March 2011. The unemployment spike for these lowskilled workers has been much sharper than for those with more education (even though the unemployment rate for all workers rose by more in this cycle, including for people with a college degree).

  • 6.

    The industries of greatest job loss match up with the labor market impacts of the Great Recession hitting those with low education, with notable employment losses in construction, manufacturing, retail, and tradetransportutilities. Construction employment has declined by nearly two million since January 2008, representing a loss of 26 percent of employment at that time. Manufacturing employment fell by over 2.2 million from January 2008 to February 2010—a pace of more than 90,000 jobs lost per month on average, or 16.5 percent of January 2008 manufacturing employment (and a recovery since February of only 15,800 manufacturing jobs per month on average). There has also been a sizeable decline of 1.5 million jobs in employment in business and professional services, though the recovery in this sector has been much stronger since early 2010 with more than 500,000 jobs already added in the past 13 months.

  • 7.

    The January 2010 worker displacement survey covering 2007 to 2009 shows a considerable decline in the reemployment rate for displaced workers compared to the previous survey (which covered years of strong employment growth), and an increase in the extent of earnings losses for reemployed workers.

  • 8.

    Displaced manufacturing workers are least likely to be reemployed (out of any industry). Workers in production occupations are similarly least likely to be reemployed looking across occupations.

The rise in longterm unemployment by itself suggests an important role for training policy, since displaced workers are likely to find themselves sitting on the sidelines for an extended


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