Time spent unemployed grows to new lengths
Charles Bello hasn’t been to a restaurant in more than two years, mostly because he has been unemployed for almost that long. The 61-year-old Penfield resident was laid off from a Rochester software company in March 2008.
Bello’s long-term joblessness became an all-too-common characteristic of the recession that began in December 2007 and probably ended at some point during the second half of 2009. But while the recession may be unofficially over, the unemployment problem lingers and figures to be the biggest economic problem of 2010.
When the recession started, it was typical for someone who was laid off to find a new job fairly quickly. The average period of unemployment in the United States was 8.4 weeks. Now, the average nationally is 28.5 weeks. In New York state, the wait between jobs is 24.6 weeks, according to the state Labor Department.
State and federal officials say that while a recovery is under way, they are less optimistic about the job market as the new year begins. Historically, the job market can be the hardest thing to repair after a recession.
“It’s going to be a very prolonged recovery, nationally and locally,” said Tammy Marino, a Rochester-based analyst for the state Labor Department.
Marino sees manufacturing taking the longest to recover. The Rochester region lost 9,700 private-sector jobs from November 2008 to November 2009, and 4,200 of those were in manufacturing. Other major sectors of the regional economy — construction, retail, professional services, tourism — also lost more than 1,000 jobs each.
The bright spots were health care and education, which added a combined 2,500 jobs and are expected to continue generating the most new positions in fields such as nursing.
Yet it is the severity of the unemployment picture — not the jobless rate itself but the length of time people have been unemployed — that distinguishes the current situation from previous recessions and recoveries.
“Layoffs are moderating, but hiring has not picked up,” said Heidi Shierholz, labor economist for the Economic Policy Institute in Washington, D.C.“Fewer people are becoming unemployed, but the unemployed are not finding work.”
The Federal Reserve, which has vowed to keep interest rates near zero to spur the economy, says that despite its efforts U.S. unemployment will average between 9.3 percent and 9.7 percent this year and get only slightly better in 2011, averaging between 8.2 percent and 8.6 percent. Those rates are more than twice as high as the roughly 4 percent level that economists say constitutes “full employment.”
Extended benefits
A point of debate is how to stimulate job creation this year. Arthur B. Laffer, a free-market economist and former adviser to Presidents Nixon, Ford and Reagan, said the economy has stopped its free fall and unemployment could fall as low as 7.5 percent this year. He cautions, however, that higher joblessness could return in 2011, when the income tax cuts enacted when George W. Bush was president are set to expire.
Laffer warns that government policy isn’t helping create jobs. “On fiscal policy, we need spending restraint and low-rate flat taxes.”
While government officials scramble to offer aid to the unemployed, pain persists. Out-of-work people often have to hope unemployment benefits get extended, and that somehow they can still pay their bills.
Bello, the Penfield resident who also was laid off from an Eastman Kodak Co. job in the 1990s, jokes he is on an “extension of an extension” of unemployment insurance.
“I’m driving a car with 150,000 miles on it,” he said. “My mortgage payment is less than $300. I have not taken a vacation in 10 years.”
250 résumés
Even for a region familiar with long-term downsizing at Kodak, the lengthy joblessness that’s common now has proven jolting to many people who find themselves in personally uncharted economic territory.
William Forsythe was laid off from Kodak in June 2006 after 26 years with the company. “The last time I looked for a job was in 1980,” said the Webster resident, a mechanical engineer.
Forsythe, 54, had kept his résumé updated through the years but never had to float it. Now, he uses CareerBuilder.com and Monster.com and estimates he has sent out 250 copies of the résumé.
Most of the prospective employers haven’t called him. Some have contacted him but only to acknowledge that he is in their files.
He is wary to show up to fill out applications. “I walk through the front doors of some buildings but it’s ‘fill out the paperwork and go home.’ So I use the Internet more.”
Five calls a day
Stephen McGarrity, 50, actively networks but has nothing to show for it so far. An accountant with a master’s degree in business administration from Rochester Institute of Technology, he returned with his family to his native Greece from northeastern Ohio after recurring economic downturns there. He takes contract jobs for short periods and meets with fellow professionals to help hone his performance at job interviews. “I always thought when I got my MBA that I would not have a problem finding a job,” McGarrity said.
He regularly attends meetings of The August Group, a networking group whose leader, Tracey Aiello, said job availability isn’t always the problem. Sometimes job seekers don’t follow up on leads or tell employers how good they are, he said.
Aiello said job seekers should prepare to get “outside of their comfort zone” and network, make phone calls and ask for help.
“My belief is there are always jobs out there. Most people take the path of least resistance. They go on the Web or a job site and apply for a job … That’s not enough. They really have to get out there and make five phone calls a day.”
The people targeted should be friends, family members, employers and others, Aiello said. Job seekers should be specific about their skills and what they’re looking for. Having a lot of contacts can help unearth openings that the job seeker might not find without such help.
Eight seekers per job
While Aiello is correct that there always are jobs available, it’s also true that there are more seekers than jobs. According to Juju.com, a job search company, there are 8.4 seekers for every position in Rochester’s metropolitan statistical area, which encompasses Monroe, Ontario, Wayne, Livingston and Orleans counties.
Juju.com ranked Rochester 38th among the nation’s 50 largest metro areas for job availability, well ahead of places such as Detroit (21.6 job seekers for every opening), St. Louis (19.9) and Miami (15.8), but lagging behind many others. The best city for job seekers is Washington, D.C., perhaps helped by increased government spending. It ranked No. 1 at two job seekers per opening.
The Economic Policy Institute’s Shierholz says the economy has to expand by at least 127,000 jobs per month just to keep up with population growth.
But to make up for the more than 7 million jobs lost during the recession, the growth would have to mushroom to 580,000 jobs a month for two years, she said.
That’s a huge challenge for the economy, said Richard Deitz, senior economist for the Buffalo branch of the Federal Reserve Bank of New York, noting that as of November the nation still had a net loss of 11,000 jobs.
In upstate New York, the challenges to job growth have been in place for more than a decade and are generally tied to the decline of manufacturing, Deitz said.
For people without jobs — roughly 40,000 in the Rochester area — it looks like an employer’s market again in 2010. The increased competition and lack of good jobs have flustered many, including those older than 40 who have skills once in high demand.
The trick may be to hang in there.
Jodi Casey, 52, of Clifton Springs, Ontario County, was a systems analyst at Citigroup’s offices in Perinton until she was laid off in August 2008. Good job prospects were scarce for months, and Casey was careful with her money as she continued to look.
On Dec. 11, she was offered a full-time computer analyst position at the University of Rochester. After 16 months, Casey has escaped the ranks of the long-term unemployed.
