Long-Term Unemployment
Some 45.5% of those classified by the Labor Department as jobless in March had been without work for more than six months, just off the record high of 45.6% set in May last year.
The waning intensity of their searches suggests that they may not be putting as much downward pressures on wages-and inflation-as some macroeconomic models assume, said James Stock, a professor of economics at Harvard University in Cambridge, Massachusetts.
That doesn't mean the Fed should start worrying about accelerating prices, according to Stock. "We still have a very weak economy," he said. "Disinflation strikes me as a much greater risk than inflation at the moment."
Gwen Robbins, a 61-year-old resident of Savannah, Georgia, is a self-styled 99er, so called because her 99 weeks of employment benefits ran out in January. Robbins, an office manager until December 2008, said she's "applied for probably close to 400 jobs" since then.
'Giving Up'
"I'm giving up on the private sector," said Robbins, when asked if she's continuing her search. Many companies seem more interested in hiring younger applicants, she said, adding that she now is seeking public-sector work with the city.
The jobs-market recovery remains "lackluster," the International Monetary Fund said in its World Economic Outlook report. The Washington-based lender forecasts that U.S. unemployment will average 8.5% this year and 7.8% in 2012.
The flaws in the labor market were aggravated by the recent recession but didn't start there, according to Krueger. The employment-to-population ratio in the last expansion, which began in 2002, never reached the 64.7% peak it attained in 2000 during the previous upturn.
Rising income inequality and sluggish wage growth during the last expansion also suggest that the labor market's troubles are ingrained, Spence said. Average hourly earnings showed little growth from 2002 to 2007 when adjusted for inflation.