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16 — LEAN TOGETHER payroll jobs in the economy is only 430,000, 3 percent above the level of December 2007, the start of the 2007-2009 recession. 3 The Labor Department’s most frequently used measure of unemployment, U-3, stood at 6.1 percent in June. This does not include discouraged workers, people working part-time when they want full-time jobs, and the underemployed. When these people are included, the Labor Department’s broader measure of the unemployment rate, U-6, was 12.1 percent. 4 Much of the decline in the unemployment rate has been because labor force participation has dropped dramatically since the beginning of the recession and has yet to recover. The labor force participation rate in June was 62.8 percent, 5 equivalent to 1978 levels, before the 1980s when millions of women moved into the labor force. This is down 3 percentage points from 66 percent in December 2007. The share of the unemployed out of work for 27 weeks or longer was 32.8 percent in June, up from 17 percent in December 2007. 6 The Labor Department’s Job Openings and Labor Turnover data also show that hiring has not yet recovered from the recession. 7 The longer people are out of work, the more trouble they have nding jobs afterwards. People out of work for longer periods of time tend to lose hard skills, such as familiarity with the latest technology, and soft skills, such as getting up on time and networking. Training programs for long-term unemployed are more challenging, both for teachers and learners. Part of the reason for this relatively low job creation is that the Administration has pursued policies that increase the cost of hiring and retaining workers. The Affordable Care Act, signed into law by President Obama in 2010, created new benet mandates for employers that make employment more costly. Mr. Obama is currently trying to increase it still further by raising the hourly minimum wage from $7.25 to $10.10. When it costs more to hire workers, some rms will expand offshore instead of at home. Others will adjust cash wages down for some employees, and turn to technology to substitute for others, especially at the low-skill end. Some examples are self-scanning machines in retail stores and computerized ordering at restaurants.
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