1.1. What does this result tell us about how easy it is for firms to see worker quality? Almost everyone has been or will be unemployed for a period of time during his or her work career. After graduation, it may take you a while to find a new job. If your firm closes, you may not find something right away. But in some cases, for some people, unemployment lasts a long time.

What are the consequences of long-term unemployment?

Simply comparing job market results for people who are unemployed for a long time versus those with no or short spells of unemployment clearly does not tell us the answer. In most cases, people with long spells of unemployment do not look exactly like those with only short spells, and at least some of the differences across those groups may be hard to observe. The authors of a recent paper conducted an interesting experiment to try to figure out what long-term unemployment does to one’s eventual job prospects