The new unemployed: Downturn leaving veteran workers jobless longer
By Dave DeWitte
The Gazette
Photo illustration by Jupiter Images
Iowans who seemed to be in some of the safest jobs before the recession are now facing some of the longest waits in limbo to find new employment.
Veteran workers who once held midlevel and management jobs constitute what some are calling “the new unemployed.” They are older, more experienced and better educated than the typical unemployed of the past.
“We are seeing people with more tenure in the workplace and a higher average age,” said Kim Johnson, executive director of continuing education at Kirkwood Community College, which provides services to job seekers.
The March unemployment rate for Americans 55 and older was 6.2 percent, according to the Bureau of Labor Statistics. That was lower than any other age group, but the highest it has been in more than two decades. It also had climbed the fastest of any age group in the past year — 89.2 percent.
Veteran workers are less likely to be laid off in an economic downturn, but they also are likely to suffer the worst if they are laid off, said Peter Orazem, Iowa State University professor of labor economics.
Orazem said employees who’ve worked for the same company for a long time acquire skills specific to that company that make them more valuable to their own employers but not necessarily other ones.
“Your value to that firm is rising more rapidly than your value to anyone else,” Orazem said. “As a result, when you are laid off, it not only takes you longer to find another job, but you also get the largest reduction in pay.”
The academic term for this is “firm-specific human capital.”
At the end of 2008, 32 percent of job seekers 55 and older had been unemployed for at least 27 weeks, compared with only 23 percent of those age 25 to 53 and 18 percent of those younger than 25.
The Gazette interviewed six workplace veterans hunting for new jobs to learn about their frustrations, challenges and inspirations in a tough job market. These are their stories.
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