Small Businesses Willing to Go the Distance on Long-Term Unemployment

John Arensmeyer

If there’s one thing small business owners are always on the lookout for, it’s talent. Talented employees help them grow and thrive. But simply keeping their eyes peeled isn’t always good enough — often times they have to find creative ways to suss out the best and the brightest.

The Great Recession put many bright individuals on the unemployment line, and once someone’s been out of work for more than six months, it becomes exponentially harder to get back into the workforce. That isn’t stopping small business owners from tapping into that pool of talent, though. In fact, hundreds of entrepreneurs have already signed a letter committing to implement some best practices for recruiting and hiring the long-term unemployed.

One of those small business owners met with the president, vice president, policymakers and CEOs from Fortune 100 and 500 companies Friday to discuss exactly how the business community can help rein in this growing problem.

Anne Zimmerman, owner of Zimmerman and Co. CPAs in Cincinnati, was one of two small business owners who met with the president at the White House. “It’s tax time, but I took time out of running my business to travel to D.C. so I could tell the president how important it is to the small business community to make provisions for the long-term unemployed,” Zimmerman said,

Extending benefits for jobless workers helps the small business community and economy by increasing consumer demand, while also giving these people the means they need to continue their job search. I signed the pledge to instill best practices within my business for recruiting and hiring the long-term unemployed because I think we need to do everything we can to help these people get back to work.

Despite recent improvements in the economy, the average time people are out of work is still twice as long as any recession since the 1950s. Jobless workers are now unemployed for an average of 37 weeks — nearly 16 weeks longer than the worst of the 1980s downturn. The Joint Economic Committee has warned that long-term unemployment has lasting effects not only on jobless workers, but also on the economy, including declining labor force participation, less consumption and a smaller tax base.

Even with some gains in the job market, it’s still harder for the long-term unemployed to get a job than any other job seeker. Studies have shown that long-term unemployed job applicants are frequently overlooked and sometimes excluded from job opportunities — even when they may have identical resumes and skills to other candidates. But there are a number of steps that small employers — our nation’s biggest job creators — can take to make their hiring practices more inclusive of qualified, long-term unemployed job seekers, including:

• Ensuring that advertising does not discourage or discriminate against unemployed individuals.
• Reviewing recruiting procedures and hiring processes so they do not intentionally or inadvertently disadvantage individuals from being considered for a job based solely on their unemployment status.
• Reviewing current recruiting practices to ensure they’re casting a broad net and encouraging all qualified candidates to consider applying, including the long-term unemployed, by taking steps that may include:
• Publicizing commitment that qualified unemployed individuals will not be disadvantaged solely on their unemployment status.
• Interviewing or otherwise considering qualified long-term unemployed individuals.
• Training hiring teams and recruiters to focus on the bona fide occupational requirements and leadership requirements for a given role, and not just on an applicant’s current or recent employment status.
• Engaging with local and regional entities in order to reach broad segments of the population with relevant skills and experience.
• Sharing best practices with staffing firms, employer associations and the broader business community.

Congress is currently debating whether to extend unemployment insurance for 1.3 million Americans whose benefits ran out on Dec. 31. The Congressional Budget Office estimates that 240,000 jobs will be lost this year due to reduced consumer demand if the benefits are not restored. And further estimates by the Congressional Budget Office and JP Morgan suggest that failure to renew unemployment benefits would result in a drop of 0.2 to 0.4 percentage points in GDP growth. What’s more, state economies already lost more than $400 million in one week as a result of the expiration of unemployment benefits.

Our opinion polling has shown that strengthening the economy has been small business owners’ top priority over the past couple years. Reinstating benefits for the long-term unemployed would benefit small businesses and the economy by giving more people a chance to continue their job search and increasing consumer demand. Underscoring the importance of this issue, President Obama called on Congress to reinstate these benefits in his 2014 State of the Union address.

Policymakers should listen to small business owners and continue long-term unemployment benefits. It’s the right thing to do for small businesses, our economy and the millions of people who are out of work and looking for a way to support themselves and their families. And it will do a lot to support the small business owners who have committed to thinning out the list of long-term unemployed.