Published: February 3, 2009
Philadelphia Tribune

Layoffs Hitting Harder

With skilled workers facing the ax, different help is needed

Those unfortunate enough to be looking for work in the current economic climate don’t need to be told that the prospects are increasingly grim.

U.S. businesses shed more than 2.5 million jobs over the past 12 months, pushing the national unemployment rate to 7.2 percent in December and making 2008 the worst year for job losses since the end of World War II.

By far the greatest impact on the job market was felt during the second half of the year.

In Pennsylvania, the unemployment rate jumped a full percentage point between September and December 2008, and in the last three months the commonwealth lost more jobs than in all of 2007.

“We are experiencing some of the most significant job losses we’ve seen in 18 years,” said Gov. Ed Rendell, on Jan. 23. “These are difficult times for Pennsylvania’s working families and even more difficult for those who have lost their jobs due to the current economic conditions.”

Evidence suggests the situation will get worse before it gets better. Looking ahead into 2009, more than a third of American companies say they plan to reduce payrolls over the next six months, while only 17 percent plan to increase employment, according to the National Association of Business Economics.

Nationally, in December, the number of officially unemployed persons increased by 632,000 to 11.1 million; Pennsylvania lost 27,100 jobs during the month, pushing the state’s unemployment rate to 6.7 percent.

Here in Philadelphia, a heavy concentration of universities and hospitals — the so-called “Eds and Meds” — has insulated the city somewhat from the more dramatic declines in payrolls that have decimated municipalities like Los Angeles and industrial cities, such as Detroit.

Philadelphia’s official unemployment rate was 6 percent in November (at press time December data was not yet available) — well below both the national and state averages. But that’s little consolation to the thousands of out-of-work Philadelphians who can’t find a job, dozens of whom gather every day at city job centers like the one sponsored by the Philadelphia Unemployment Project (PUP).

John Dodds, PUP’s director, says beyond the increase in the sheer number of people looking for work, what strikes him most is the number of people who had what were once considered secure positions and are now finding themselves jobless.

“We’re seeing people with more skills now — there are people who are normally more employable that are now unemployed,” said Dodds. “Even during good times, there are people who are between jobs, but right now it seems to be that people with higher educations and qualifications are also losing their jobs.”

PUP began its advocacy work during the recession of 1975 and today helps hundreds of Philadelphian’s each year find gainful employment by offering services ranging from career counseling and resume building, to guidance on how to file for unemployment benefits. Dodds says the group helps fill a void that has left many unemployed feeling they have nowhere to turn.

“It used to be that we had unemployment offices around the city, but they’ve all been closed for six or eight years and now it’s all phone work; so it’s often harder for people to find out about services and organizations,” Dodds said. “Having someone to talk to face-to-face is important.” 

Beyond counseling services, PUP has a computer lab, which offers individuals looking for work a place to pursue employment listings, and hosts a weekly “jobs club” where job seekers can check in with each other and get support.

Faith Whitehead, a jobs developer at PUP’s North Broad Street Unemployment Information Center, says she has seen a significant increase in the number of people coming through the center’s doors each day.

“We have people here constantly,” she said. “On a daily basis we may see up to 30 people coming in to use the computers; a good 10 to 20 people come faithfully every day and are on the computers all day long looking for employment.”

While the majority of PUP’s clients come from blue-collar backgrounds, in truth, no one is immune from the current employment crisis. Just ask Ed Kelleher, founder and principal of the Wayne-based outplacement firm Kelleher Associates.

Kelleher deals with the highest rung of the newly unemployed: the senior managers and top-level executives who are now finding themselves among the ranks of the jobless. 

For the past 11 years, some of Philadelphia’s biggest firms have called on Kelleher when they are preparing to downsize. He says for some of his clients the experience can be a rude awakening.

“It’s not unusual that we’ll see someone that’s a senior vice president or something and had been with a company for 20 years and never had to look for a job,” he said, “or someone that’s a hot ticket and the last few times they changed jobs, it’s because they were found by the high-end executive recruiters and this is the first time they’ve had to present themselves to the market on a proactive basis.”

Kelleher has seen hundreds if not thousands of people let go and, more often than not, he is the first person they see after being told they no longer have a job. He and a small staff provide customized programs for roughly 50 to 60 clients at a time.

Like PUP’s Whitehead, Kelleher says he sees a significant increase in the number of people in need of his services.

“There’s no question there are more individuals in transition and it’s getting tighter,” he said. “This is almost unprecedented. I’ve seen other recessions where the job market was tight but the combination of it all, it’s almost like this is terra incognita — it’s a place on the map we haven’t seen yet.”

Even for those lucky enough to have a guide like Kelleher to help navigate the landscape, the path from jobless to employed is longer and more strenuous today than in years. 

From the moment he meets with them — usually the same day they lose their job — Kelleher walks his clients through a series of steps, beginning with an initial evaluation to determine a client’s skill-set and their personality traits. Next come self-affirmation exercises, the setting of objectives, drafting of a customized resume, and mock interviews.

Kelleher is quick to stress he is not a headhunter. He doesn’t actually find his clients jobs; but by the time he is done with them, he says, they are much more prepared to find one on their own.

“It’s tough out there, but there are still jobs to be had. You need to be competitive and a lot of that is attitudinal and making sure your presentation is spot-on,” Kelleher explained. “That’s the role that we play here. Ultimately, we’re trying to get people to look through the windshield instead of the rearview mirror.” 

For Dodds at Philadelphia Unemployment Project, one of the biggest challenges is letting people know there’s help available.

“One of the issues for us is that people who are working all the time don’t pay attention to an organization like ours and that’s why we’re trying to get the word out to people that we’re here to help,” he said. “That’s one of our dilemmas, that people who work for 10 or 20 years don’t know where to go for services.”

To get the word out, on Feb. 6 PUP is hosting a symposium titled, “Surviving the Recession: A Resource Fair for the Unemployed.”

The event will feature speakers and workshops designed to teach people how to manage being unemployed during a recession, as well as credit and housing counselors and advisers to offer assistance obtaining health care, food stamps and energy assistance.  

Beyond offering a support system for the unemployed, Dodds and PUP do advocacy work and have lobbied both federal and state government on issues including mortgage relief and unemployment insurance reform — a topic that has been getting a lot of attention lately.

Across the United States, only 37 percent of workers who lose their jobs typically collect unemployment benefits, according to U.S. Labor Department statistics.

Dodds says there are a number of reasons for this, but most reflect flaws in a system that has changed little since its creation in 1935.

“A lot of the people around here don’t collect because they haven’t worked long enough; it could take up to nine months of work before you can even qualify for unemployment and one of the changes that is being proposed as part of the [Obama] stimulus [package] is to use the most recent quarter of wages to determine eligibility,” explained Dodds. “It’s typically lesser skilled workers that end up in those transient jobs and often they are not eligible for unemployment.”

In fact, the Government Accountability Office (GAO) has found that low-wage workers are only one-third as likely to receive unemployment benefits as higher-wage workers, even though they are more likely to become unemployed.

Lawmakers are busy working to reform the unemployment insurance system to make it more accessible and expand the scope of the benefits.

In 2007, Sen. Edward Kennedy, D-Mass., along with co-sponsors including then-Sen. Barack Obama and Sen. Arlen Specter, R-Pa., introduced the Unemployment Insurance Modernization Act, which would have provided incentives to states that offered unemployment to part-time workers and others who are excluded from receiving them. That bill never passed, but on Jan. 8, U.S. Rep. Jim McDermott, D-Wash., reintroduced his own version of the bill in the House.

“Today, millions of hard-working Americans who lost their job during this economic crisis face a second crisis when they try to obtain their unemployment insurance compensation and discover that they do not qualify because the system that was created in the economic reality of 1935 is unable to match the needs of the labor market of the 21st century,” McDermott said.

Among other things, HR 290, which carries the same name as the Kennedy Bill, would enable more low-wage and part-time workers to qualify for unemployment insurance compensation. The House Ways and Means Committee is currently in the process of reviewing the legislation.