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Published October 11, 2012, 11:30 PM

Hot Topics: ‘Pink slip stigma’ stronger the longer you don’t have a job

Call it “pink slip stigma.” When you don’t have a job, it’s harder to convince a new employer to give you one. And we all know the longer you’re out of the game, the harder it gets. What we didn’t know was exactly how hard. Now, thanks to some sneaky economists, using 12,000 fake resumes, there’s some solid data.

By: Ben Popken, TODAY contributor , INFORUM

Call it “pink slip stigma.” When you don’t have a job, it’s harder to convince a new employer to give you one. And we all know the longer you’re out of the game, the harder it gets. What we didn’t know was exactly how hard. Now, thanks to some sneaky economists, using 12,000 fake resumes, there’s some solid data.

A team of researchers sent out more than 12,000 fake resumes to more than 3,000 online job postings. They designed the resumes so that the candidates were all equally qualified. The only thing they changed was the length of time the fictional candidate was out of work.

For the 5 million long-term unemployed, defined as those out of work for 27 weeks or more, it doesn’t look pretty.

“The labor market penalizes you for being out of work,” Kory Kroft, co-author of the study “Duration Dependence and Labor Market Conditions: Theory and Evidence from a Field Experiment,” published by the National Bureau of Economic Research, told NBC News.

From 0-6 months, the percentage of callbacks gradually declines from about 7 percent. But once it hits 6-8 months, there’s a steep drop-off. After 6 months of being jobless, there’s only a 4 percent chance you’ll get called in for an interview, a 45 percent plummet.

What gives? Well, “There’s two kinds of employees, productive and unproductive,” said Kroft. “Firms will use the number of months you’ve been out of work as a ‘proxy’ or ‘signal’ of how productive you are.”

The idea is that when you’re out of work, your job is getting a job. If you’re not great at that job, you might not be great at the one the employer is hiring for. And the effect is greater the longer you’ve been out of work.

One bright spot, if you can call it that, is that after 8 months, the “pink slip stigma” levels off. So if you’re sitting on a chair in a lobby waiting for a job interview next to a guy out of work for 14 months and you’ve been without a job for 34, he doesn’t have any better shot than you just based on that fact alone.

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