Long term unemployment is intrinsically destructive, both to the individuals losing careers and money and to the economy as a whole. While understanding why it's happening is important, it's also important to compensate for it, for the good of society (and the economy) as a whole. Government is one of the few agencies that at least theoretically has the care of society as one of its goals; private corporations aren't going to give a sh*t, they're not going to "take one for the team" and hire less experienced people, even if the long term effect is increased consumer spending.

It is after all why things like welfare exist. So peoples' lives aren't ruined, and the secondary effects of that happening on a wide scale.