- The Washington Times - Wednesday, October 30, 2002

Nikki Sorrel, a recent browser on the Monster.com job bulletin board, has been looking for work for so long that she's given up until next year. Washingtonian Carol J.T. has nabbed only one job interview since she lost her software analyst job in January 2001.
They are not the only ones. The weak economic recovery this year has produced barely more than 150,000 new jobs less than the average number created in one month during the 1990s economic expansion. With more than 8 million people looking for work, long-term joblessness has become a significant problem for many.
While unskilled and less-educated laborers often took the brunt of layoffs in past recessions, this time around joblessness is disproportionately hitting workers with skills and education, from recent college graduates and airline pilots to technology workers caught in the dot-com bust, and executives dismissed from disgraced and bankrupt corporations.
The unemployment rate has stayed at historically low levels, below 6 percent despite the recession, but labor analysts say that's partly because many workers have grown discouraged and dropped out. The length of time it takes to find a new job is at its highest in eight years.
"The recovery so far has been close to jobless," said Nariman Behravesh, chief economist with the forecasting group DRI-WEFA. Though the recession may be over, he said, businesses continue to trim workers and hold off hiring to cut costs and restore profits.
This painful "restructuring and renewal" stage of the recovery, like the one in the early 1990s, is likely to persist for months. But eventually it will produce the healthy earnings gains needed for businesses to start growing and hiring again, he said.
A survey by Watson Wyatt Worldwide found that more than half of corporations cut staff in the last year even as the economy was recovering and that nearly half imposed hiring freezes and kept a lid on raises. As a result, a measure of help-wanted advertising published by the nonprofit Conference Board last month fell to a 38-year low.
But recent job cuts are only a small part of the problem for the unemployed. During the recession, nearly 2 million jobs were lost, according to the Bureau of Labor Statistics, so the meager net gain in jobs since May has offered little hope to those looking for work.
Job openings have gradually started to crop up in some fields, particularly service areas such as health care, teaching and temporary employment.
The revival of prospects in devastated industries such as technology and investment banking could take years, however, because of the speculative growth that drove both to excesses during the turn-of-the-century boom, Mr. Behravesh said.
The good news is that cost-cutting by businesses has produced strong productivity gains that enable the 131 million workers who still hold jobs to enjoy solid income growth. That, in turn, fuels steady growth in consumer spending and supports growth in the overall economy, he said.
But for now, the void of job opportunities is creating a growing angst not only among the unemployed, but among people who have jobs and feel stuck in place with little opportunity for advancement.
"It's amazing how difficult the market has become," said an unemployed worker on one of the popular Internet chat rooms sponsored by Monster.com. Hailing from North Carolina and calling himself just "That Guy," he was one of dozens who poured out their frustrations recently
"I'm honestly ready to just give up," he said. "I'm not even trying to move up career-wise. I'm willing to take a $20,000 cut in salary, don't care about benefits, and am willing to switch industries. Yet I'm having more difficulty than I ever had before."
"Carol J.T." said she's had no luck finding a job in the Washington area, despite her solid technology skills. She said she would accept any "legal, reliable means of producing income," including part-time, contract or temporary work but has gotten no offers.
"Yankee Gal" said she lost her job a year ago, ostensibly because of the downturn caused by the September 11 attacks. But now she thinks "cheap employers used 9/11 as an excuse to freeze hiring and simply dump more work onto already overtaxed employees."
In a chat room for technology workers, an aerospace employee from Southern California with 19 years' experience said he has been out of work since May and is finding that employers won't give him a chance because he's overqualified for the positions they have.
A tech worker from Washington state advised him to play down his strong technical skills by devising a "low-tech" resume that emphasizes broader job skills such as writing and customer-service experience.
By switching to such a low-tech resume, the Pacific Northwest worker said he was able to land a customer-service job at a department store. "At least I'm working again after spending six months at home waiting for the phone to ring," he said.
Several tech workers said they've seen software support and other desirable jobs moved offshore to India, where workers are paid one-fifth as much as American workers. Because of that, several said they don't expect to see job or income gains in their field for years to come.
John A. Challenger, president of Challenger, Gray & Christmas Inc., a Chicago outplacement firm, said workers are experiencing "a sequel to the jobless recovery" that lasted 15 months after the 1990-91 recession.
But the pain level may be even higher this time around for those who were once highly paid in technical and management jobs, he said. Nearly half of those out of work for at least six months today are high-income professionals, a record for that category, he said.
Some unemployed workers have been hurting themselves by continuing to have unrealistically high salary expectations nurtured during the "bubble years" of the 1990s, he said. Dot-com and other tech professionals, in particular, may have to take salary cuts of 20 percent to 30 percent, he said.
Another source of job losses has been the massive wave of bankruptcies, mergers and corporate scandals in the last year, which is having "the greatest impact on the ranks of middle management and support staff," Mr. Challenger said.
"Unfortunately, in this job market these categories of workers will have the toughest time finding a job."
Adding insult to injury, laid-off workers are receiving drastically less generous severance payments than they did just three years ago, reflecting the urgency of cost-cutting by businesses, he said.
The average length of severance pay has plunged by more than half, to 10 weeks from 21.8 weeks in 1999, he said. And the drop in pay occurred just as the length of time it takes workers to find new jobs climbed to an average 18 weeks.
Most laid-off workers are entitled to unemployment benefits that last about eight months after their severance pay runs out. More than 3 million workers are drawing extended unemployment benefits. But about 2 million are expected to run out of benefits by the end of the year.
Some workers are prolonging their unemployment by refusing to relocate to where the jobs are, Mr. Challenger said. It's understandable, he said, that they want to stay close to their friends, family and professional contacts. The "nesting" urge has grown strong since the September 11 terrorist attacks.

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