Corporate America Likes High Unemployment Rates

It gives companies more leverage over workers, writes Paul Krugman
By John Johnson,  Newser Staff
Posted Dec 27, 2013 1:23 PM CST
Corporate America Likes High Unemployment Rates
Job seekers line up outside the Ferguson Community Center in Cordova, Tenn.   (AP Photo/The Commercial Appeal, Jim Weber, File)

Benefits for the long-term unemployed run out tomorrow, which Paul Krugman thinks is not only a travesty but a reminder that we need to make reducing unemployment a top priority. The problem is that the political will to do so isn't strong, he writes in the New York Times. And that's in part because "the economy may be lousy for workers, but corporate America is doing just fine."

Consider the leverage that companies have over their workers amid high jobless rates. Employees are more likely to put up with lousy pay and treatment because quitting isn't much of an option, writes Krugman. As a result, people are working in fear even as corporate profits are surging. "In fact, it’s possible (although by no means certain) that corporate interests are actually doing better in a somewhat depressed economy than they would if we had full employment," he writes. It's time things changed—for both the employed and the unemployed—and the most important step we can take "is to put jobs back on the agenda." Click for the full column. (More unemployment benefits stories.)

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