Obama has corporations sign to end bias against long-term unemployed

President Barack Obama announced on Friday that more than 300 companies had pledged not to rule out hiring people just because their resumes show they have been out of work for an extended time.

The companies, including Walmart, Apple and General Motors, have agreed to a one-page list of best practices for recruiting and hiring people from the ranks of the long-term unemployed — a group that disproportionately struggles to find work in spite of an improved economy.

“Folks who’ve been unemployed the longest often have the toughest time getting back to work. It’s a cruel Catch-22 that the longer you’re unemployed the more unemployable you may seem,” Obama said, speaking before many of the chief executive officers who had signed on to the initiative.

“This is an illusion, but it’s one we know statistically is happening,” he added.

The U.S. jobless rate has remained stubbornly high at 6.7 percent, but Gene Sperling, Obama’s top economic adviser, told reporters the rate would be closer to 5 percent were it not for the roadblocks to finding work for those unemployed for six months or longer.

"We are trying to address what we feel is the heart of that negative cycle, which is the potential stigmatization of people merely for the sake that they are long-term unemployed," said Sperling, director of the governmental National Economic Council.

Obama met with the group of willing chief executive officers on Friday as part of his pledge to do what he can for the economy despite a reluctance by Republicans in Congress to agree with other parts of his plan. Obama has tried but so far failed to persuade Congress to extend jobless benefits for people who have been unsuccessfully seeking work for more than six months.

Benefits for 1.6 million Americans have expired since the end of 2013. The figure could swell to 4.9 million people by the end of 2014 unless legislation is passed.

In his address on Friday, Obama cited studies that have demonstrated hiring bias against the long-term unemployed.

One study published this month by researchers from the University of Toronto, Montreal’s McGill University and the University of Chicago used 12,000 fictitious resumes to respond to real job openings in 100 cities. Despite identical work experience, education and demographics, applicants who had been out of work for eight months had 45 percent fewer calls from employers than those who had been unemployed only for a month or two.

Sperling called the study "fairly decisive evidence that merely the status of being long-term unemployed serves as a disadvantage."

A second study from the Massachusetts Institute of Technology found that someone unemployed for one month will secure one interview on average for every 10 job applications submitted, while someone out of work for seven months has to send 35 resumes to get just one interview.

Sperling began talking to business leaders in May about the issue, and he and Obama adviser Valerie Jarrett began approaching businesses directly in the fall about committing to review screening processes used to sort resumes, and other hiring practices that shut out the long-term unemployed.

“It’s a lot harder to look for work if you can’t put gas in the gas tank, if you’re worried about putting food on the table for your kid,” Obama said. “If mom isn’t paying the rent or the phone bill, it’s a lot harder for her to follow up with an employer.”

Heeding that call, more than 80 of the largest U.S. businesses signed on, including companies such as Apple, Walmart, Ford Motor Co., General Motors Co., Proctor & Gamble Co., JPMorgan Chase & Co. and AT&T.

Obama also announced $150 million in grants for public-private programs that help match the long-term unemployed with local employers.

Neither a fact sheet about the new changes distributed by the White House nor President Obama in his Friday speech made any mention of whether the hiring best practices would be enforced in any way. The White House did not immediately respond to Al Jazeera’s requests for clarification.

The White House also said it did not have a projection of how many people from the ranks of the unemployed would now be able to land an interview because of the changes.

“I can’t give you an exact number,” Sperling said. “But these are companies that employ millions and millions and millions of people and are going to be hiring more people, and I think this is going to have a significant impact.”

Al Jazeera and Reuters