Suffering an Unfair Job Loss is Tough, our california employment attorneys can help.

Los Angeles Jobless Rates Deceiving

October 12, 2012

The recent headline on CNN was bleak: "Workers Give Up in Los Angeles." welding,jpg.jpg

It appears that while unemployment figures have been falling, down to 11 percent in August, compared to 12.4 percent in July, that's bad news for several reasons:

First, the country's jobless rate is 8.1 percent, so we're much higher to begin with. And secondly, the jobless rate isn't dropping because the situation is getting better. In fact, Los Angeles Chapter 7 Bankruptcy Attorney Vincent Howard of HOWARD LAW understands it's because they are withdrawing from the labor force altogether.

Not only is this obviously problematic for these individuals, it doesn't bode well for the economy as a whole.

According to a survey by California's Employment Development Department, more than 100,000 workers have bowed out of the labor market just since January. This is even taking into account seasonal workers. This sting is amplified when you compare those figures to other major metropolitan areas. San Francisco, New York, Chicago, Washington D.C. - all of those areas are seeing growth in labor pools.

Why is it so bad here? Researchers believe it has a lot to do first of all with the real estate bust, which impacted Los Angeles far more than in other cities. Construction and contracting jobs dropped off dramatically, and although they've inched back some, there are still about 50,000 fewer than there were five years ago.

For people who have been out of work long-term, the labor market is unforgiving. It's well-known anecdotally that the longer you've been without a job, the harder it may be to get a new one. But now, a new study shows us jut how tough it is. The research firm sent out 12,000 phony resumes to some 3,000 companies with job postings. The researchers set it up so that all the potential candidates were equally qualified, but they changed the amount of time the imaginary candidate was unemployed.

Here's what they found:

Those fictional candidates who were out of work for between 0 and 6 months saw the number of callbacks drop by about 7 percent. When the resumes listed an unemployment length of between 6 and 8 months, it drops by an astonishing 45 percent. In fact, at that point, you have about a 4 percent chance of getting a call back.

The researchers hypothesize that companies are looking at the number of months you've been without a job as a sign of how productive you are. The idea is that if you are out-of-work, your job is to get a job. If you are not successful in that, employers begin to wonder how successful you'll be at doing the work they have available. It's a vicious cycle.

Unemployment benefits may only last for so long, and while there may be some other forms of government assistance available, it can be paltry.

This is how many people who are out-of-work for extended periods land themselves in debt. This is where a Chapter 7 bankruptcy begins to make a lot of sense. Because there is no steady source of income, a Chapter 13 reorganization plan likely won't work because it requires the ability to pay back that debt, even if on a longer timeline and at more reasonable rates. A Chapter 7 liquidates all of your debts and allows you to walk away from them.

Los Angeles Bankruptcy Attorney Vincent Howard at HOWARD LAW can help. You can reach us toll-free at 1-800-872-5925 or send us a message online.

Additional Resources:
Workers give up in Los Angeles, Sept. 27, 2012, By Annalyn Censky, CNNMoney

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