i know i sound glib when i talk about rising unemployment...(cuz it's just my nature)
but i just read this article posted on CFZ, human faces on the statistics, and it sounds grim. note the workers exhausting unemployment benefits.
usatoday.com
Resources dry up as joblessness drags on
By Jon Swartz, USA TODAY
SAN FRANCISCO — Harry Strout never imagined he would end up behind a counter at a consumer-electronics store. Not after more than 20 years as a telecom engineer at Merrill Lynch, Kaiser Permanente and Pacific Bell. Not with a bachelor's degree in chemistry and a master's in business administration. And not after several years as a consultant. But after a year of unemployment — during which he sent more than 1,500 résumés without luck — he took a job this month at RadioShack for $6.75 an hour.
Johnny Cain of Arlington, Texas, advertises his services. Cain previously worked as a CPA in the telecom industry.
By Rodger Mallison, AP/Star-Telegram
"I had to make a living," Strout, 61, says. "I don't think of this as an ignoble experience."
Nor does Anna O'Neil, 28, a fresh-faced public-relations specialist. She impulsively moved to Silicon Valley from Atlanta in 2000 to join dot-com start-up Bigstep. She's managed a San Francisco restaurant for 10 months, having been laid off by Bigstep in 2001. "I'm used to a paycheck, and my insurance ran out," O'Neil says.
Strout and O'Neil are the lucky ones. They have jobs. Nationwide, the number of people who have been jobless for long periods has risen to its highest level since 1994. Almost 1.5 million people have been out of work for more than six months, up 80% from a year ago, the Department of Labor says. Especially hard hit: workers in telecom and tech, two fast-growth industries of the 1990s that have since suffered unprecedented downturns.
Workers exhausting unemployment benefits, March-August:
Alabama* 13,518
Alaska 3,505
Arizona 13,199
Arkansas 9,506
California** 73,727
Colorado 16,808
Connecticut 15,890
Delaware 2,348
District of Columbia* 4,856
Florida 75,045
Georgia 52,090
Hawaii 4,041
Idaho 3,140
Illinois 71,037
Indiana 26,057
Iowa 10,096
Kansas 5,678
Kentucky 13,817
Louisiana 11,717
Maine 3,579
Maryland 16,111
Massachusetts 24,890
Michigan 50,359
Minnesota 21,161
Mississippi 12,800
Missouri 22,336
Montana* 1,700
Nebraska* 3,607
Nevada 11,267
New Hampshire 1,774
New Jersey 24,207
New Mexico 3,571
New York 134,992
North Carolina 36,531
North Dakota 1,317
Ohio 44,385
Oklahoma 9,434
Oregon* 1,123
Pennsylvania** 48,192
Rhode Island* 5,750
South Carolina 22,128
South Dakota 414
Tennessee 36,233
Texas 94,212
Utah 7,647
Vermont 1,281
Virginia 19,178
Washington 7,699
West Virginia 3,783
Wisconsin 21,982
Wyoming 1,115
Total 1,120,832
Source: Center on Budget and Policy Priorities
Notes: *August data estimated. **Estimates.
The long layoffs are having a big impact — on individuals and the economy. Some wages in Silicon Valley are declining for the first time in a decade. Silicon Valley bankruptcies are rising. More tech and telecom workers are shifting industries, as did workers before them in the auto, oil and aerospace industries. That could deplete the talent pool when tech and telecom rebound.
At the same time, many of the cash-strapped unemployed have been forced to borrow money and dip into their retirement savings, which could weaken their financial standing for years. For many, life without a steady paycheck has necessitated big lifestyle changes and dealing for the first time in their professional lives with rejection and low self-esteem.
In the tech-heavy Silicon Valley, "It's the worst long-term unemployment I've seen in 20 years," says Patti Wilson, a career counselor.
The elimination of nearly 320,000 jobs this year in computers, telecom and e-commerce, the aging of the workforce and the globalization of industries have combined to make long-term unemployment more likely for more people, says UCLA economics professor Tom Lieser.
In Santa Clara County — the epicenter of Silicon Valley — the jobless rate was 7.6% last month, down from a record 7.8% in July and up from 1.7% less than two years ago. Close behind: telecom-heavy Dallas, with a 7.2% jobless rate in July — its second-highest figure in a decade.
The jobless cover all demographics: software engineers who in previous downturns were still highly sought after, youngsters who dove into the exploding dot-com market and older workers who did the same.
"It's extremely difficult out there," says Rene Manzo, 45, a network engineer laid off by Global Crossing in July 2001. "There are too many people competing for jobs, and employers are looking for incredibly specialized applicants."
For younger workers, this might be their first run at unemployment. For those in their 40s, 50s and 60s, the job search is complicated by the fact that they may be too experienced for many jobs and scare employers, who fear they would just jump when the economy picks up.
For all, the market is dismal. Hires of high-tech workers plunged 27% to 834,727 this year, says trade group Information Technology Association of America. David Levine, an economics professor at the University of California-Berkeley, notes that 2000 was the first time a tech downturn and recession occurred at the same time. Most tech analysts don't expect a rebound until next year or 2004. Some companies are going through three or four rounds of layoffs. Bankruptcy filings in telecom have claimed dozens, including heavyweights WorldCom and Global Crossing.
As a result, job seekers are:
Looking longer and harder. The typical job search for tech workers is now about six months, compared with three months a year ago and three weeks during tech's heyday two years ago, says Mike Freccero, a managing director of recruitment firm Spherion. "I used to get responses to my résumés. Now, it's a black hole," says Betty Fellows, 52, a software-support specialist who has been unemployed for 16 months. She has applied for more than 100 jobs.
Duffy Jennings, 55, former vice president of communications for e-commerce site Fogdog Sports, has been unemployed for 21 months. He applied for dozens of jobs, e-mailed his résumé to more than 200 recruiters nationwide, sent letters to dozens of San Francisco Bay Area CEOs, networked, talked to career counselors and contacted companies in Phoenix, Los Angeles, Seattle, New York and Portland, Ore.
His efforts have yielded only three interviews. "I've gone from feeling I could work anywhere to frustration and resignation," he says.
The longer someone is unemployed, the more difficult it can be to get hired. "Employers think there's something wrong with you," Fellows says.
Lowering expectations. Those lucky to find tech jobs are willing to take less pay and fewer perks. "Say goodbye to stock options, free lunches and massages," says Tamara Shetler, 34, an unemployed public-relations specialist laid off by Gateway in January.
Last year, the average wage in Silicon Valley declined for the first time in a decade — 2% to $76,800 — and could be depressed further this year by the tight job market, says Mike Curran, director of the North Valley Workforce Board.
Jennings made $12,000 last year — from consulting. It was his lowest salary since 1967. At Fogdog Sports, Jennings pulled down a six-figure salary plus bonus and stock options.
Changing lifestyles. Thirty-five thousand dollars. That's how much Linda Laubenheimer, 41, owes credit-card companies since she lost her job as a systems administrator at software firm Nominum more than a year ago. Calls from creditors have grown so persistent that one of Laubenheimer's annoyed roommates recently bought an answering machine. "I get by sweating the rent and mooching," she says.
For some, prolonged unemployment could have a deep financial impact that shadows them for years. Strout has burned through more than $20,000 in retirement savings. "There went some of my nest egg," he says. Jennings is considering selling his San Francisco Bay Area home and moving into a condominium. To make ends meet, his wife is working extra hours as a nurse.
Bankruptcy filings of all types in Santa Clara County, and three nearby counties, were up 12% through July of this year vs. the same period last year. A majority of the filings pertain to individuals.
Changing careers. In previous downturns, many of today's unemployed tech and telecom workers were able to switch to healthier companies in those industries. But much of the tech and telecom sectors seem to be contracting at once this time. That has forced some to ditch high-tech careers for lower-paying jobs as cab drivers, bartenders, teachers and department store clerks.
Cecil Lee, 39, finds himself in that position. Since he bolted Intel in early 2000 to join the dot-com craze, he's been laid off twice — the most recent time in early 2002. Now, the former network manager — who has a business degree emphasizing information systems — is ready to apply as a supermarket checker and security guard.
"I need a job — any job — for the income and benefits," Lee says.
Manzo, the former Global Crossing engineer, is contemplating cutting hair. He owned two salons in his native France.
Many of the tech jobless are eyeing the booming real estate market. Jennings is studying for a Realtor's license, as is Pacita Dimacali, 53, a former marketing communications manager for Sprint in Dallas. "High-tech has a stigma," Shetler says. She has applied for a job in video production, where she has experience in foreign documentaries.
"People are willing to grab a low-paying job of any kind — even if temporary — instead of holding out for the dream job, as they did in the late 1990s," says Priscilla Azcueta, vice president of Manpower Staffing Services in San Jose, Calif.
The lowered expectations of the unemployed and dreary job outlook often lead to feelings of personal and professional self-doubt and alienation, causing strained relations and — in some cases — illness, the workers say.
Many tech workers were accustomed to being treated as prize recruits. Now, the only correspondence many receive are rejection letters. "You have to take care of yourself mentally and physically to battle these demons," says Jennings, who concedes his prolonged job search has put a strain on his marriage.
"The emotional swings I've gone through have been unbelievable," says Kris Strittmater, a former software-marketing manager who spends four to six hours a day researching job Web sites. "I call this time in my life the roller-coaster ride from hell — up, down, rejection, anger, depression, hope, fear — you name it."
Manzo is more resigned.
"It's a very slow life," he says. |
