Chart 5 shows that while the short-term and long-term unemployment rates
move with the business cycle, long-term unemployment typically peaks after short-term unemployment.
Last year, Cramer, Cho, and I estimated the Phillips curve by regressing expected real wage growth on various measures of labor market slack, including short-term and long-term unemployment rates
. (21) We found that the coefficient on the short-term unemployment rate was much larger than that on the long-term unemployment rate
, and a test of the difference between these two effects was statistically significant.
Income growth and long-term unemployment rates
also played a substantial role.
The city also scores below average on pupils getting A-C grades at GCSE level, long-term unemployment rates
, households living in fuel poverty and people using outdoor space for exercising.
Rather than including a variable for the long-term unemployment proportion as in our analysis, Kiley includes both short-term and long-term unemployment rates
, which is functionally similar.
Both the short- and long-term unemployment rates
rose considerably during the recession.
Figure 4 plots the actual total enrollment rate; two forecasts of the total enrollment rate using our estimates from table 1 and the changes in the unemployment and long-term unemployment rates
in 2008, 2009, and 2010; and a counterfactual forecast of enrollment that held the unemployment rate at its 2007 level.
In fact, long-term unemployment rates
relative to total unemployment were above 40 percent in virtually every sector as of June 2012.
labor market is unlikely to suffer from the persistently high long-term unemployment rates
that dogged Europe in the 1970s and 1980s.
But women tend to have higher unemployment and long-term unemployment rates
. Ethnicity is also associated with the risk of long-term unemployment in a significant way (Machin and Manning 1999, Rudolph, 2001).
By affecting these flow rates, labor-market institutions and policies influence both short - and long-term unemployment rates
. In every labor market, workers and firms are regulated by institutions and policies that affect these flow rates, such as minimum wages, unemployment insurance, severance pay, advance notice, labor taxes, and so on.