Unemployed – Forever

Political transitions and economic upheavals often leave the oldest workers out in the bitter cold. In China, the move to a Chinese view of capitalism left older workers, many of whom fell through the educational cracks when the Cultural Revolution (1966-76) as schools and universities were just shut down in favor of academically-worthless reeducation camps, clinging to the last vestiges of the Iron Rice Bowl (support from a communist state). Marginalized and under educated, they became a lost generation in China’s recovery. As the Soviet Union collapsed, older workers were completely unprepared for the hyper-capitalistic surge of the new plutocracy. They can be seen, often dressed in worn and tattered clothes, traipsing down the streets of Moscow and St. Petersburg, heads hung low.

The paucity of jobs, the evaporation of bastions of corporate solidity (and often the pension plans that they promised) in bankruptcies and reorganizations, and the acceleration of new technologies and business models have combined to provide the pain of truth to millions of older workers now squeezed out of the marketplace, unable to sustain this seemingly never-ending economic collapse. The passage of time to these once-skilled workers is often fatal, at least when it comes to the prospects of ever finding work again. While younger people can hold out and will still be skilled and employable even in five years, many older workers fear they have just lost their last job. Many report nightmares and depression as routine today, even among those who still have work.

Indeed, the statistics seems to support this bleak view of their future prospects for employment. The September 20^th New York Times: “Of the 14.9 million unemployed, more than 2.2 million are 55 or older. Nearly half of them have been unemployed six months or longer, according to the Labor Department. The unemployment rate in the group — 7.3 percent — is at a record, more than double what it was at the beginning of the latest recession… After other recent downturns, older people who lost jobs fretted about how long it would take to return to the work force and worried that they might never recover their former incomes. But today, because it will take years to absorb the giant pool of unemployed at the economy’s recent pace, many of these older people may simply age out of the labor force before their luck changes.”

With pension savings devastated by the economy and the “house-as-savings-account” theory decimated, so many older workers were forced to consider delaying or forgetting about retirement. Some are able to remain at their current jobs; others are not so lucky: “Being unemployed at any age can be crushing. But older workers suspect their résumés often get shoved aside in favor of those from younger workers. Others discover that their job-seeking skills — as well as some technical skills sought by employers — are rusty after years of working for the same company… Many had in fact anticipated working past conventional retirement ages to gird themselves financially for longer life spans, expensive health care and reduced pension guarantees…

“Older people who lose their jobs take longer to find work. In August, the average time unemployed for those 55 and older was slightly more than 39 weeks, according to the Labor Department, the longest of any age group. That is much worse than in August 1983, also after a deep recession, when someone unemployed in that age group spent an average of 27.5 weeks finding work… At this year’s pace of an average of 82,000 new jobs a month, it will take at least eight more years to create the 8 million positions lost during the recession. And that does not even allow for population growth.” The Times. Taking Social Security early erodes benefits (25% less at age 62 than at age 66), but for many it is the only resort, all this as the system is beginning paying out more than it is taking in.

This segment of society has been an important consumer-base, spending beyond the stereotypes of medicines and senior citizens facilities. They took trips, bought cars and went out to restaurants, shopping merrily along the way. Not only have many curtailed such fantasies, they are no longer even to take of themselves, placing new strains on society and their families in otherwise economically intolerable times. “Forced early retirement imposes an intense financial strain, particularly for those at lower incomes. The recession and its aftermath have already pushed down some older workers. In figures released last week by the Census Bureau, the poverty rate among those 55 to 64 increased to 9.4 percent in 2009, from 8.6 percent in 2007.” The Times. Fear, frustration and anger will find expression in the coming mid-term elections, but there are no miracle cures or simple political expediencies that will stitch the bottom back on to the U.S. economy; deregulating and cutting taxes even more will not improve the job picture, but the deficit will find new pain.

Signs of improvement are slight and long-term; even the Wall Street financial engine is reeling from a summer of under-performance: “Worldwide, the number of stock offerings is down 15 percent from this time last year, while bond issuance is off 25 percent, according to Capital IQ, a research firm. Based on these trends, Ms. Whitney predicts that annual revenue from Wall Street’s main businesses will drop 25 percent, to around $42 billion in 2010, from $56 billion last year.” The workers most likely to feel the cuts are very likely in their later earning years.

I’m Peter Dekom, and this is, and probably will be from here on out, a very different United States of America.