Fareed Zakaria warns of a “lost generation”

I have been thinking a lot about America’s economy and American jobs lately, and have an essay on the subject in this week’s TIME Magazine and a long post on the Global Public Square. I also spoke with Eliot Spitzer about jobs on In the Arena. Here’s the transcript of our conversation:

Eliot Spitzer: All this week, CNN has been focusing in-depth on the crisis of jobs in America. And that includes an amazingly insightful article in this week’s TIME Magazine by our own Fareed Zakaria. Fareed, as always, thank you so much for being here. Frame the issue for us.

Fareed Zakaria: The simplest way to think about it is we don’t realize what the unemployment rate is. We think we have about seven million people unemployed. Actually, if you take into account the people who have stopped looking for work and you take into account the people who have part-time jobs (and these part-time jobs pay on average $19,000, which is half the median wage) – if you put all that together, you have 24 million people unemployed. This is almost close to great depression levels of unemployment.

What unemployment does is outside of the fact that it means you have fewer taxes and all your budgets get screwed up at the state level. The personal tragedy of unemployment is that you lose these people. This becomes a lost generation because they lose skills and they lose work habits. They kind of get lost to society.

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