December 28, 2010

SO IS THIS THE HOPE, OR THE CHANGE? Bureau of Labor Statistics: “Long Term Unemployment” Extended to 5 Years. “Effective with data for January 2011, the Current Population Survey (CPS) will be modified to allow respondents to report longer durations of unemployment. Presently, the CPS accepts unemployment durations of up to 2 years; any response of unemployment duration greater than this is entered as 2 years. Starting with data for January 2011, respondents will be able to report unemployment durations of up to 5 years. This change will likely affect estimates of average (mean) duration of unemployment. . . . There has been an unprecedented rise in the number of persons with very long durations of unemployment during the recent labor market downturn. Nearly 10 percent of unemployed persons had been looking for work for about 2 years or more in the third quarter of 2010. Because of this increase, BLS and the Census Bureau are updating the CPS instrument to accept reported unemployment durations of up to 5 years. This upper bound was selected to allow reporting of considerably longer durations while limiting the effect of erroneous extreme values (outliers).”

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