Chris Osborne didn't expect his life to turn out like this.

He'd worked for more than 25 years in IT and was in a well-paid job he enjoyed. He was newly married and a comfortable retirement was nearing. Then, in mid-2012, his job as a senior project manager was culled as part of public service cuts.

After picking up some on-again, off-again contract work, he has now been out of a job since November 2013, despite applying for more than 400 positions and registering with every IT job agency he could find. In that time he has had only six interviews.

"I've lost my confidence and self-esteem, and basically, my career is gone," he says.

Now 62, he thinks his age is putting off employers, although he has not experienced any direct discrimination. Sometimes he tries to disguise his age, by removing older jobs from his CV.

Being out of work for so long has made him question many things, including the importance of work. He has experienced depression and his marriage has suffered.

"I'm a child of the 1970s. I don't see myself as one of those traditional blokes who see themselves as a breadwinner," he says. "I always took the attitude, even at uni in my late teens, that work was a means to an end not an end in itself.

"But I have discovered that a lot of my self-worth and sense of who I am was more tied up into my career than I believed. There was more to it than I had been telling myself."

Long-term unemployment (being out of work for more than a year) attracts little media or political attention but it alarms informed observers in the welfare sector.

Since the global financial crisis struck in mid 2008 the number of long-term unemployed has risen by more than 150 per cent to about 175,000 people, according to the Bureau of Statistics. That's markedly quicker than the overall growth in unemployment in the same time.

Both the young, without skills and experience, and the old, in particular those in declining industries, are being badly affected.

Being out of work for long periods is not just about the loss of income, although that can be crippling. There's another aspect, which is little talked about.

Many people suffer as much from the loss of social worth, status and even shame, as they do from the loss of income when they are out of work for long periods. This can affect their health, relationships and has even contributed to suicides.

Osborne says the experience has knocked him about, despite his attempts to help himself.

"When I'm down in the dumps I don't want to talk to people," he says. "Emotionally I've been suffering from depression, so what I've had to do is take up voluntary work to keep myself busy."

"My wife got pretty upset with me sitting around in the lounge, so I took over the housework and weekly shopping. She's settled down now, she says 'I don't care what you do as long as you're occupied'."

There's been an exercise regime to lose some weight as well as keeping in touch with a small network of friends in a similar position.

"There's three of us, we prop each other when one or the other is feeling down in the dumps. You can tell, they go quiet. One of them, his marriage broke up, he's been through a horrendous divorce and property settlement, he's been suicidal."

Some try to hide the loss of work and social status. One long-term job-seeker, who got her qualifications as a mature-aged student, spoke of some of the shame she experienced from not having a job.

"None of my friends know, they'd start to think something is wrong with you if they did," the registered psychologist said, who asked not to be identified.

"I've been telling my friends I've limited my work, due to a back injury, and have had to cut back a lot of my hours."

With more than 780,000 people officially unemployed and many more under-employed, there is simply not enough work for full employment to be even close to being achieved. And yet popularly, any discussion of joblessness still focuses on the idea that the unemployed are "dole bludgers" or "lazy".

Brotherhood of St Laurence executive director Tony Nicholson said the economy had changed rapidly since the latest financial crisis.

"Our economy is in transition, moving to be predominantly in service and knowledge industries," he says. "The modern economy has new requirements, the transition from a declining industry to a growth industry is highly problematic for a lot of people."

There was a "mismatch" between job requirements and the unemployed, he said, a situation that cannot be solved just by economic growth.

Nicholson says the changing labour market is not reflected in public policies and how the employment placement system works.

"[Jobs Services Australia] has a dismal record of getting disadvantaged job-seekers into work because it's a model that is designed simply to respond to cyclical unemployment," he says.

"It is a job-matching scheme that would be effective if we had the economy of the 1960s and 1970s."

The experience of long-term joblessness cuts across the social classes, from people in white-collar well-paid professionals such as Osborne, to people forced out of small businesses and to working-class people, whose jobs have been hurt by the demise of the old protectionist economy.

Kevin Dalton wasn't pushed from his full-time job in 2002, he decided to take voluntary redundancy after 14 years at the shipyards in Williamstown.

"I had lumps in my throat as I left, he said. '"A co-worker said 'It's not a very easy walk is it?' After 14 years it was not."

It was the last time he has worked full-time. Dalton had worked at the shipyards in maintenance and as a correspondence controller. Once it would have been a job for life, and his own father had worked for years in the same section at the same shipyard.

After he took redundancy and a payout Dalton took the chance to have a break from work and moved up to Sydney to spend time with his kids. "I thought I really had not had a chance to see my kids grow up."

Later, with the kids older, he got some cleaning work and returned to Melbourne in 2009. But in 2011, after leaving a job at the North Melbourne football club, it became very hard. "I couldn't get a job."

Since then, there have been long periods with little or no work, making it hard to scrape out a living. Not helping are his bad knees.

He's been waiting three years for surgery. "There are days I'm almost crying I'm in that much pain. But I refuse to let it get the better of me."

He's working 15 hours a week now, but would like to work full-time, possibly as a supervisor to give his knees some respite. "It does take its toll."

Hans Liebich never expected to be out of work, let alone for three years.

Until 2012, Liebich was a small businessman, for two decades running a shoe store with his wife in Camperdown. Business was tough, with sales and margins under pressure, and at 62 he decided to sell up.

He thought he'd be able to pick up some work. Instead, he spent three years out of work, struggling for cash and forced to borrow money from his adult children. "It's been a demeaning experience, none of us like asking our kids for money," he says.

Newstart has been "nowhere near adequate" for Liebich and his wife to survive on, he said.

"We basically had to survive, my wife and I, on something like $950 to $1000 a fortnight, paying rent and bills," he says.

"It is not a sustainable life, you deny yourself the slightest creature comfort, quite often you can't go anywhere because you don't want to use petrol. You really are on the bones of your backside all the time."

Liebich, until he sold his business, had worked all his life.

"I honestly expected to find work, even if it was casual. I was absolutely shocked by the attitude of one particular local business. I went to have a chat with them and they sounded very enthusiastic, until they found out my age."

Liebich did some volunteer work at Lifeline but when he turned 65 late last year he moved onto the pension, which, due to its higher payment, offered a little financial relief. He never did get back into the paid labour market.

Chris Osborne, three years from retirement age, just wants to work. "I really don't give a shit about the money any more," he says.

"The fact that I haven't been able to get work has severely undermined our retirement plans, our expectations have been lowered. I've been caught four or five years too early. The plan I had to move into retirement and transition was cut short and I was not mentally prepared for that to happen."

He's thinking about finding paid work in the area he's been volunteering in, helping patients with dementia. He's "given up trying" with IT.

He wishes it were different. "I'm fit, with no health problems, a good mind and all that experience. It's just going to waste."