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A Perspective from Main Street: Long-Term Unemployment and Workforce

Part II: Barriers for Workers

Skills and spatial mismatch may help explain part of the unusually high amount of unemployment relative to the number of vacancies. Essentially, a skills mismatch means workers are less likely to be hired because they do not have the correct skills. A spatial mismatch means that the workers are not able to commute to where the jobs are located.

Lack of Skills

Many forum participants across the country echoed the need for workers to improve their jobs skills. In West Virginia, for example, participants mentioned that many applicants lack the "hard" skills required to fill health care positions, particularly basic computer knowledge, and many workers are resistant to additional workforce training.22

In addition, a lack of "soft" skills among the unemployed was a constant theme in the forums. Participants discussed the difficulties of hiring in the health care industry due to a lack of candidates that can demonstrate timeliness, appropriate dress and hygiene, and professional conduct. Participants added that employees missing work without an excuse and disregarding workplace policies and protocols were ongoing problems. Furthermore, younger workers were distracted by technology, often ignoring policies about cell phone and social network use during work hours.23

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Spatial Mismatch

Challenging transportation logistics are a hurdle for many unemployed residents of rural, urban, and suburban communities. Indeed, in many forums, inadequate public transit and car affordability emerged as significant barriers to attaining and maintaining employment. Transportation challenges can cause workers to be absent or late, or to spend more time than can be economically justified commuting to jobs. For example, in urban areas of Maryland, unreliable vehicles or the lack of owning a vehicle is a common issue among LMI families. In urban settings, public transportation typically favors standard rush hour schedules and routes, which are not always conducive to the needs of people who work shifts or other nontraditional hours.24

Suburban residents face transportation challenges similar to their urban counterparts. In these areas, public transportation is often very limited, making a private automobile a necessity. In Tennessee, forum participants noted that the public transportation system does a poor job of connecting communities of workers with jobs.

Not surprisingly, a lack of transportation options is a significant obstacle to employment for residents of rural communities and small towns as well. Rural residents often need to commute to other towns or metropolitan areas for jobs. Most rural areas have very limited public transportation options, and given the increase in gas prices, workers are becoming increasingly isolated from jobs, education, and training opportunities outside of their community.25

The forums included significant conversations about rural and small town residents' aversion to driving or moving to metro regions for work and educational opportunities. The culture and networks established within these communities influence individual workplace decisions. For instance, many workers in the small cities of Eden and Concord, North Carolina, are multigenerational residents who value the community too highly to consider commuting to jobs outside of their immediate city. These sentiments were captured in comments by participants who noted the high value of living in small cities where family and community networks are strong, reassuring, and dependable. Some of these participants indicated a preference to avoid driving more than five miles from home to work or commuting via interstate highways.26

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Risk Management Practices

Risk management surfaced as a significant concern among employers. Participants stated that hiring decisions are frequently driven by employer perceptions. In Missouri, participants said the perception of the risks involved in hiring the long-term unemployed and the hard-to-employ has a definite impact on the willingness and ability of employers to hire them. Stricter regulations and an increase in risk management practices by employers are negatively affecting many of these populations.27

A common theme among forum participants was that the need to manage risk is a growing challenge that affects hiring. For example, in West Virginia, all of the participating employers have a regular stream of open positions. They prefer to leave positions vacant rather than to risk hiring an unreliable employee who leaves them vulnerable to liability issues. In other words, as facilities adapt to regulatory and legal changes, employers prefer to manage the vacancies rather than hire the wrong person. An example of a hiring risk could include a candidate with a nursing degree but who also has a checkered history of proper customer care or poor soft skills.28

In addition, many forum participants detailed the difficulties that ex-offenders face when seeking employment. Historically, individuals with a criminal record have experienced challenges in finding jobs, and under the current economic conditions, these challenges are particularly acute. Participants reported that there is no standard for how employers run or treat criminal background checks. Participants in Maryland stated that some employers reject any applicant with a criminal record. Other employers establish a "look back" period or consider the severity of the crime and adjust employment offers accordingly.29

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Balancing Wages and Benefits

Forum participants repeatedly noted that many workers struggle to find a job that pays a wage that they can subside on, including covering the cost of being at the job. For example, many unemployed persons incur additional transportation and child-care costs if they accept a job. As a result, some LMI individuals balance the tradeoff between public assistance and low wage jobs. In many forums, participants noted that the need to manage wages to maximize total income and benefits keeps many individuals out of the workforce or from increasing their pay. For example, participants in Nebraska discussed the "cliff effect" experienced when employees receive an increase in wages that results in reduced support from income-tested public benefits, especially child-care subsidies. As a result, income tests that are too low or too stringent can be a disincentive for advancing in a job.30

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Barriers for Workers in the Health-Care Sector

A look at the growing health-care sector provides another example of barriers to employment. During the recent recession, when many industries were shedding jobs, the health-care sector continued to add jobs at a relatively vigorous rate, averaging 22,000 new jobs per year.31 In fact, the health-care sector experienced robust growth throughout the last three recessions. Over the past year, employment grew in all major health-care settings, including a 4.4 percent growth in home health care and a 1.2 percent growth in hospitals jobs. This growth is expected to continue in the long run.32 That being said, the health-care sector's story varies greatly across regions.

In many communities, health-care positions go unfilled because local unemployed workers lack the requisite hard skills to fill these vacancies. As noted above, health-care administrators in West Virginia reported that applicants often lack basic computer knowledge. A perceived unwillingness to improve computer skills, even among incumbent workers, exacerbates the problem as the field constantly introduces new programs and software.33

Moreover, some communities do not offer enough training to keep pace with the labor demands of the health-care sector. For example, participants in Tennessee said that despite a high demand for nurses, there is a lack of available nursing educators to meet the need.34 Meanwhile, employers in some communities find it difficult to keep health-care positions filled as a result of low salaries and demanding work conditions. In Alabama, participants stated that the local colleges and universities graduate substantial numbers of qualified workers for health-care openings, but workers often turn down offers due to low pay.35

Due to a lack of standardized credentials across regions and facilities, many potential health-care workers struggle to navigate the training systems and obtain the "correct" hard skills. In Maryland, participants mentioned the difficulty in placing workers with the "wrong" training. For example, they said that there is a steady stream of individuals being certified as Licensed Practical Nurses (LPNs); however, the local health-care sector places a higher value on trained nursing certifications other than the LPN.36

Another reason that available health-care positions often go unfilled is the lack of soft skills among potential health-care employees. Employer participants noted problems with workers' punctuality, professional conduct, proper appearance, and patient service skills. Participants agreed that communication skills are a consistent shortcoming for entry-level employees as well as among some nurses. Furthermore, employers have challenges with employees missing work without an appropriate excuse and disobeying company policies and protocols that are essential in a health-care environment.37

Finally, rural communities find filling vacant health-care positions to be particularly challenging. Rural communities resort to competing with each other on a regular basis for nurses and technicians. As a result, these workers tend to cycle through different facilities, usually for more money, a perception of better benefits, or a better work place.38

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22. Forum in Elkins, West Virginia, on December 5, 2011. Hosted by FRB Richmond. Return to text

23. Forum in Elkins, West Virginia, on December 5, 2011. Hosted by FRB Richmond. Return to text

24. Forum in Baltimore, Maryland, on February 13, 2012. Hosted by FRB Richmond. Return to text

25. Forum in Dyersburg, Tennessee, on February 7, 2012. Hosted by FRB St. Louis. Return to text

26. Forums in Eden and Concord, North Carolina, on January 31 and February 1, 2012, respectively. Hosted by FRB Richmond. Return to text

27. Forum in Kansas City, Missouri, on January 23, 2012. Hosted by FRB Kansas City. Return to text

28. Forum in Elkins, West Virginia, on December 5, 2011. Hosted by FRB Richmond. Return to text

29. Forum in Baltimore, Maryland, on February 13, 2012. Hosted by FRB Richmond. Return to text

30. Forum in Omaha, Nebraska, on January 24, 2012. Hosted by FRB Kansas City. Return to text

31. Nancy Condon (2011), "Examining Healthcare Employment: The Prognosis is Good," Federal Reserve Bank of Atlanta, Econ South, (Third quarter),  Leaving the Board . Return to text

32. Condon (2011). Return to text

33. Forum in Elkins, West Virginia, on December 5, 2011. Hosted by FRB Richmond. Return to text

34. Forum in Memphis, Tennessee, on February 23, 2012. Hosted by FRB St. Louis. Return to text

35. Forum in Birmingham, Alabama, on January 27, 2012. Hosted by FRB Atlanta. Return to text

36. Forum in Baltimore, Maryland, on February 13, 2012. Hosted by FRB Richmond. Return to text

37. Forum in Elkins, West Virginia, on December 5, 2011. Hosted by FRB Richmond. Return to text

38. Forum in Elkins, West Virginia, on December 5, 2011. Hosted by FRB Richmond. Return to text

Last update: February 4, 2013

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