Why Isn't the Internet Helping the Unemployed?

It's pretty hard to try to imagine any reason it could be good to be unemployed right now. With unemployment stubbornly high, companies slow to hire, and unemployment benefits running out for many long-term unemployed, it's a grim situation for many. But jobless Americans do have one distinct advantage today compared to those looking for work during other downturns throughout history: technology is much better. Even as recently as recession that caused very high unemployment in the early 1980s, it was a very different world. Back then, people had to rely on newspaper wanted ads, employment agencies, or word-of-mouth to find jobs. Now the unemployed can utilize the power of the Internet to look for job openings across the country, or even the world. So why doesn't it appear to be helping much?

Of course, there's one really obvious reason: there just aren't enough job openings as there are unemployed Americans. That's quite easy to see through data released yesterday by the Bureau of Labor Statistics. In November, there were at least 15 million unemployed Americans looking for jobs, but only 3.25 million openings. That averages out to 4.65 job searchers per opening. So unless the Internet can magically create jobs, then it's not going to fix the problem.

But even for those jobs that are out there, the wide search radii provided by Internet job site searches might not be helping much. There are a number of factors that are preventing good labor mobility, which is the ability for job searchers to move from an area where they can't find to work to another area where work is available. Even if someone living in Ohio wants to move 66 miles from Mansfield, where the unemployment rate is 10.7%, to Columbus, where it's just 8.0%, some obstacles exist that could be preventing the move.

Own a Home

Everybody knows that the housing bubble's pop was one of the factors that led to unemployment rising to a catastrophic level, but it's also helping to keep it there by limiting labor mobility. If you own a home, even if you are current on your bills, you might not be able to move. In some cases, a mortgage may have gone underwater due to home prices falling. In other cases, even if the home has sufficient equity to allow a move, the buying demand is so weak and supply is so large that it could take months or years to sell a house for a reasonable price. If you can't sell your home, it's generally pretty hard to move.

Spouse Still Has a Job

Today two-income households are more common than ever. If a husband gets laid off, often a wife's income must be relied on, or vice-versa. And if one family member still has a job, then unless you can both simultaneously find new jobs in another location, moving might not help much. This forces many people to stay put even, if there's a job elsewhere available.

Presented by

Daniel Indiviglio was an associate editor at The Atlantic from 2009 through 2011. He is now the Washington, D.C.-based columnist for Reuters Breakingviews. He is also a 2011 Robert Novak Journalism Fellow through the Phillips Foundation. More

Indiviglio has also written for Forbes. Prior to becoming a journalist, he spent several years working as an investment banker and a consultant.

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