Job gloom at all-time high

job_gloom.gi.top.jpgPessimism over job prospects is at an all-time high. By Tami Luhby, senior writer


NEW YORK (CNNMoney.com) -- More Americans than ever before feel they have no hope of finding a job.

A record 1.21 million people want to work, but said they aren't looking because of the weak labor market, according to federal statistics released Friday. The June figure is up from 793,000 a year ago.

The statistic is yet another sign of how bleak the employment picture is. And these folks, known as "discouraged workers," aren't even counted in the unemployment rate because they haven't looked for work in the past four weeks.

Unlike those who have given up completely, discouraged workers have hunted for a job during the past year.

Still, there's not much hope out there for this segment of the unemployed. There are five workers for every available opening.

"Things are very, very weak and they are not expected to strengthen anytime soon. It's going to be a long slog," said Heidi Shierholz, a labor economist at the Economic Policy Institute, a left-leaning group.

Shierholz expects the unemployment rate, now at 9.5%, to hover around 10% through early next year.

Those who have been out of work for a long time will find it more difficult to land a new job, particularly if they are in sectors that will likely remain depressed, such as manufacturing and construction. They don't have the skills to switch industries.

"They stay unemployed because there's no fit," said Lakshman Achuthan, managing director of Economic Cycle Research Institute.

The labor force, in general, has shrunk over the past two months, contracting by 974,000 people as they lost confidence in their employment prospects. That reverses part of the gain of 1.7 million workers in the first four months of 2010, when a wave of optimism flowed through the nation.

More people may have stopped looking for work because their jobless benefits are expiring, wrote Deutsche Bank economists Joseph LaVorgna and Carl Riccadonna in a note. To collect unemployment benefits, people must be actively seeking work.

As the labor force contracts, the unemployment rate falls. This is one reason why it dropped in June from 9.7% the month before.

"The decline in the unemployment rate is not a reflection of strength, but rather a sign of discouragement among the ranks of the unemployed," the economists said. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 17,086.63 -26.91 -0.16%
Nasdaq 4,473.70 17.68 0.40%
S&P 500 1,987.01 3.48 0.18%
Treasuries 2.46 -0.00 -0.08%
Data as of 4:58pm ET
Company Price Change % Change
Apple Inc 97.19 2.47 2.61%
Facebook Inc 71.29 2.02 2.92%
Microsoft Corp 44.87 0.04 0.09%
EMC Corp 28.75 0.23 0.81%
Bank of America Corp... 15.52 0.00 0.00%
Data as of 4:01pm ET

Sections

General Motors recalls another 718,000 U.S. cars to deal with variety of problems including seat height adjustments, welds and power steering. More

With cost-cutting at the U.S. Postal Service more letter carriers are working later and later to deliver your mail. About 38% of mail is delivered after 5 p.m. in cities nationwide. And areas like Atlanta, Washington and South Florida, it's 70%. More

As 65,000 IDF reservists are tapped to serve in Gaza, Israeli's tech community tries to maintain business as usual, amidst bombs, sirens and employees called to war. More

Chinese buyers are now the biggest international players in the U.S. housing market and some states are seeing billions of dollars in real estate deals as a result. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.