Røe Isaksen fears that long-term unemployment will take hold

Torbjørn Røe IsaksenPhoto: Lise Åserud / NTB
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A total of 33,600 people were registered as long-term unemployed at the end of March. Minister of Labor and Social Inclusion Torbjørn Røe Isaksen (H) fears that they will fall outside the workforce for good.

“If we do not fight against this with powerful measures and make good political choices, we could see unemployment that sticks,” Isaksen told news bureau NTB.

Long-term unemployment has exploded during the corona pandemic. In January 2020, there were just over 17,000 people who had been unemployed or laid off for more than six months, which is the definition of the term.

In September, the number approached 40,000 before falling slightly over the winter. In total, long-term unemployment after the financial crisis in 2008–09 was just over 20,000 at the highest, and after the oil crisis in 2014–15 almost 25,000.

About a third of the unemployed are furloughed, which means that they basically have the prospect of returning to work when the employer can take them back.

Particularly concerned about young people

The Minister of Labor and Social Inclusion is particularly concerned about the young long-term unemployed. Employees under the age of 40 are overrepresented in the statistics. Many of them have low-paid jobs and relatively little education.

“In a way, they only have one foot in the workforce,” Isaksen said.

Young people are also given high priority due to the consequences of falling permanently out of the workforce.

“The consequence for the rest of your life is greater if you are young and fall out as unemployed. The longer you are unemployed, the greater the chance of falling permanently out. In the worst case, someone who falls outside as a 25-year-old ends up with 40 years outside the workforce,” the Minister of Labor said.

No growth in social assistance

Long-term unemployment grew especially in September-October, i.e., about six months after Norway first closed on March 12, 2020. Many have now been unemployed for more than a year. Røe Isaksen says that there is some increased demand for applications for work assessment allowance, but so far, no significant increase in the number of people applying for social assistance.

“But if we do not get people back, and no new jobs are created, then many will end up switching to more permanent benefits,” Røe Isaksen noted.

The most important measure the Minister is promoting to combat long-term unemployment is to create new jobs through the opening up of society as the level of corona infection decreases.

“The biggest overall measure is to get private business back on track because virtually everyone who is furloughed comes from private business,” he said.

Wants to make new education rules permanent

In addition, the long-term unemployed are given priority in the follow-up by the NAV, and additional projects have been implemented to help young unemployed people. 

Røe Isaksen and the government have also placed great emphasis on dissolving the regulations for education while receiving unemployment benefits.

During the pandemic, recipients of unemployment benefits have been able to take training at the primary and secondary level, as well as vocational school education, under certain conditions.

Since April, Parliament has considered a proposal that will make the rules permanent, as they expire on October 1.

Source: © NTB Scanpix / #Norway Today / #NorwayTodayFinance

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