The national unemployment rate in May 2012 was 8.2%. Five states (California, Nevada, New Jersey, North Carolina, and Rhode Island) and the District of Columbia had considerably higher rates (as much as 11.6% in Nevada). For those who are unemployed, or underemployed, the lack of job opportunities has meant personal and financial challenges. They have been forced to tap into or even drain savings, rely on help from family and friends, or even turn to government programs for assistance. But their individual experiences pale in comparison to the loss to our country — it’s been a real talent and money drain.
My daughters are good examples. Each has a graduate degree but both have been stymied by the economy to make full use of their talents. My older daughter was laid off from her prestigious job as a clothing designer with a Fortune 500 company at the start of the recession. Since then she hasn’t been idle; she earned a master’s degree, had a baby, and continued to do contract work in her field. My younger daughter, who does advocacy for a nonprofit organization, has been essentially locked into a job with no prospects for growth; she even had to take a pay cut. Think of the designs that never got made, and the programs that never were advanced.
Now multiply these examples by the millions of similarly-situated, very talented, well-educated individuals who are unemployed, underemployed, or stuck in dead-end jobs. The country has lost the benefit of ideas, innovations, sales, and other indices of productivity. The country has also lost the ancillary benefits that result from the income that these people could have earned. Think of the taxes they would have paid, the houses and furnishings they would have bought, the investments they would have made. Also, think about the drain on the public resources to pay for unemployment benefits, food stamps, and other assistance programs.
Bottom line: I’m a big proponent of self-employment — creating your own job by starting your own business. But this route is not for everyone. The vast majority of people prefer, or are better suited, to be employees in someone else’s business. The sooner the economy starts to move at a much better pace than it currently is, the sooner the country will benefit from improvements in employment.