What's wrong with hiring an unemployed person?

I'd like to hear from recruiters and hiring managers about why they won't even consider an application or resume from an unemployed person. It seems as though they don't care about bringing in the person who can best do the job and contribute to their organization. Instead they get hung up on silly things, like the length of unemployment. People can be unemployed for any number of reasons; it isn't automatically a given that they are lazy, not up-to-date on skills, or some sort of "low performer."

The most important question in any job interview is "What is your plan for doing this job effectively?" (Or for a profit, if it's in private industry). Anyone can talk about their past accomplishments. But what does that have to do with how they will perform in their next job? Past performance doesn't necessarily predict future performance.  Which is why length of unemployment should not be a consideration in the hiring process. Besides, does anyone stay in one job forever? Even your best candidates can leave a job - not only someone who is under-employed and looking for a better opportunity. Everyone is always looking for something better!

I'm not sure how hiring managers sleep at night, placing ads that state "only employed" need apply. So enlighten me, recruiters. What am I missing here?