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Fed economists optimistic on drop in long-term US unemployed

Published on Jul 22, 2014 7:11 AM

NEW YORK (REUTERS) - There are many reasons to be optimistic about the recent drop in long-term unemployment, Federal Reserve economists said in a paper published on Monday, the latest evidence helping to put to rest a debate that gripped the US central bank earlier in the year.

The paper, focused on Americans unemployed for 27 weeks or more, found that they have had better luck landing lasting jobs in recent months, aligning them more closely with those who have been out of work for shorter durations.

The findings come as economists and Fed officials grow more sanguine about the prospects of the long-term unemployed, a segment of the labour market that declined by 1.2 million in the last year and totalled 3.1 million in June.

Earlier this year, a debate raged within economic circles over whether such workers were becoming marginalised and even demonised by employers.

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