After charting five consecutive years of steady growth in the unemployment rate for post-9/11 veterans, the Bureau of Labor Statistics recently reported a sharp five-percentage point decline in January and February of this year, bringing the unemployment rate for post-9/11 veterans below that of the general population for the first time since 2008.
The unemployment rate for post-9/11 veterans had doubled from 2007 to 2011, reaching an annual high of 12.1 percent this past year. But the first two months of 2012 has nearly erased the five years of steady expansion. January marked a striking three-percentage point decline to 9.1 percent and February ended at 7.6 percent, the lowest rate since 2007.
Is this some rare blip in the numbers, or proof that veterans are finally gaining a foothold in corporate America?
A closer look at the report shows that the number of veterans who obtained employment in the first two months of 2012 has already surpassed the total number of veterans that obtained employment in all of last year. Some 166,000 post-9/11 veterans obtained employment in January and February, rocketing past the 127,000 veterans that obtained jobs in 2011. Inversely, the total number of unemployed veterans has already declined by 80,000 in January and February, reversing the upward trend and negating the addition of 29,000 vets to the unemployment ranks in 2011.
On the surface, it looks like the many veteran employment initiatives are finally working, but the steep decline in January and February should give pause.
The recent reduction in post-9/11 GI Bill benefits may better explain the significant change in the veteran unemployment rate. In August 2011, the VA capped GI Bill benefits at $17,500 per year and linked the monthly housing stipend to the number of credit hours a student-veteran takes.
This was a big reduction from the previous unlimited tuition reimbursement and the full housing stipend provided for full-time or part-time students. This change negatively impacted out-of-state student-veterans, veterans attending private schools in which yearly tuition exceeds the annual cap, as well as veterans enrolled in part-time programs. Although many of the veterans who were receiving the GI Bill benefits before the August 2011 change were grandfathered into the new program and were able to keep their current benefits, some have seen their benefits drastically reduced and as a result must seek part-time employment or go into debt.
According to the Department of Veterans Affairs, more than 400,000 veterans are enrolled in higher education and have filed for spring 2012 GI Bill benefits, which represent nearly 20 percent of all veterans who have served since the Sept. 11 terrorist attacks. So this is a huge chunk of veterans that can directly impact the unemployment rate.
Although there are no data that outline how many student-veterans are also employed part-time, it is possible that an increasingly larger portion of veterans finding jobs are actually student-veterans securing part-time work to help make up for the recent reduction in GI Bill benefits. Since employed persons consist of “persons who did any work for pay or profit during the survey reference week,” student-veterans in part-time jobs are subsequently categorized as “employed” and would therefore reduce the unemployment rate.
A part-time job is still a far cry from obtaining a full-time role at a good company and beginning a new career. Although the significant reduction in the veteran unemployment rate is certainly welcome news, we should not celebrate just yet.
Mike Abrams is a former Marine Corps captain and Afghanistan veteran. He recently graduated from New York University and is currently interning with CNBC.