"House lock" is not a major factor when it comes to a homeowner's ability to find a job.   A working paper commissioned by the Federal Reserve Bank of Boston found that, while many Americans lack mobility because their homes are "underwater" in respect to their mortgages, this is only a marginal contributing factor to continued unemployment.

Migration across states and among homeowners has fallen sharply at the same time as a widespread drop in housing prices has resulted in wide-spread negative home equity.  According to CoreLogic, 10.7 million homes, 22.1 percent of all residential properties with a mortgage, were worth less than their mortgages at the end of the third quarter of 2011 and an additional 2.4 million borrowers had less than 5 percent equity.

The nation's unemployment rate has hovered around 9 percent since early 2009.  At the same time, data from the Bureau of Labor Statistics show that, despite increasing numbers of job openings since June of 2009, there has been little increase in hiring.  Not only has unemployment been especially persistent during this economic downturn, but individuals have remained out of work for exceptionally long periods.   Yet some employers state that they cannot find workers with the right mix of skills suggesting that some type of mismatch might be occurring.

Data from the Internal Revenue Service indicates that, while mobility across states has been declining gradually for more than two decades, there has been a recent sharp downturn.  While migration across labor markets is cyclical, the drop during this recession has been larger than in other post-war recessions.  It has also disproportionately involved homeowners.  The number of home owners who moved cross-state between 2006 and 2009 fell by 25.5 percent versus a decline of 13.6 percent among renters.

In their working paper,  Are American Homeowners Locked into Their Houses?  The Impact of Housing Market Conditions on State-to-State Migration, Alicia Sasser Modestino and Julia Dennett of the Fed's New England Public Policy Center looked at these three factors to determine whether having negative equity in their homes prevents homeowners from relocating to states with better job markets.

The concept of "housing lock" is not new and a number of studies have examined how it might contribute to geographic mobility.  However, much of the earlier research has been restricted either in terms of the geographic area studied, the length of the study, or the group studied (i.e. younger households.).  This was nationwide, included all demographic groups, and used a time period that roughly coincides with the recession. The study used a logistic regression framework to estimate the impact of negative equity on migration while controlling for changes in relative economics conditions and differences in time-invariant characteristics between origin and destination states.  Finally the authors did a "back-of-the-envelope calculation" to determine the potential impact of restricted mobility on the national unemployment rate.

The analysis found that negative equity did reduce cross-state migration between 2006 and 2009.  A one-standard deviation increase in the share of underwater households in the origin state reduces the outflow of migrants to the destination state by 2.93 percent.  For the average origin-destination pair this meant a reduction in out-migration between 0.595 to 0.578 per 1000 initial residents or 85 migrants each year.  Summed across all possible destination states this would mean a decrease in the outflow from the average origin state of roughly 4,000 residents.

This is a small number relative to total migration in the U.S and reduces national migration by 0.05 percent or 110,000 to 150,000 fewer individuals migrating across state lines in any given year compared to observed migration in 2008-2009 of 5.6 million persons.

Assuming that all migrants who were constrained from moving due to negative equity were unemployed and seeking a job and that they would have found employment in the new state, the absence of house lock would have reduced the nation's unemployment rate by at most 0.10 percentage points annually between 2006 and 2009 or a rate of 9.0 rather than 9.3 in 2009.  Recognizing that not all migrants are job-seekers or would be successful in finding work after moving, "Yields a national unemployment rate that is virtually unchanged from the actual one that prevailed in each year."   The disproportionate impact on the mobility of homeowners versus renters has no effects on labor market statistics.

The authors conclude that it seems reasonable for policymakers to focus on efforts that stimulate aggregate demand in order to reduce unemployment rather than policies to reduce negative impact.  Instead, increased efforts to alleviate the housing sector's drag on the economy such as by assisting homeowners to refinance or reducing foreclosures may be more effective in stimulating aggregate demand and reducing the high rate of joblessness.