Layoff fears part of 'new normal' - Affluence, college education no protection from job market that cycles quickly through workers

Layoff fears part of 'new normal' - Affluence, college education no protection from job market that cycles quickly through workers
By Barbara Rose, Tribune staff reporter. Tribune staff reporter Darnell Little contributed to this report
Copyright © 2007, Chicago Tribune
Published July 1, 2007

Good skills and a good attitude no longer ensure steady employment, even when the economy is humming. This is the first in an occasional series about job loss and the changing nature of employment.

The center of greater Barrington, population 40,000, is a compact village reminiscent of a Norman Rockwell painting. Radiating in all directions are six affiliated communities offering winding roads with 5-acre lots and gated enclaves. Nearby corporate headquarters include Motorola Inc. in Schaumburg, Sears Holdings Corp. in Hoffman Estates, Allstate Corp. in Northbrook, and Baxter International Inc. and Walgreen Co., both in Deerfield. Eighty-six percent of greater Barrington's employed adults work as managers and professionals, or in sales and office jobs. The median household income tops $110,000.

But below the surface of a strong economy is an unsettling trend that may be contributing to worrying changes in the school lunch program and elsewhere. Residents seem to be losing jobs at a faster clip. They land back on their feet but not necessarily at the kind of salaries to which they had become accustomed.

"There's more recycling going on, faster cycling," said retired consultant Philip Roussel, who sits on the board of the Barrington Career Center, which helps job seekers in the northwest suburbs. Despite low unemployment, attendance at a weekly networking meeting is up 37 percent.

People find jobs faster in a good economy "but more people are losing jobs than you might think," Roussel says.

Barrington's awakening to a national trend of rising rates of job loss for better-educated workers is a mirror for profound changes in white-collar employment. More than a decade after economists declared the old system of steady lifetime jobs dead, white-collar workers are struggling with the fact they can be laid off even in good times, more than once during a career.

It wasn't always the case.

When Barrington residents were asked in 1996 to check which of 10 difficulties their household faced, "difficulty finding child care" got the biggest score. It was the first survey by a coalition of 20 non-profit and government groups.

By 2005, "involuntary job loss due to downsizing or other reason" topped the list, followed closely by "difficulty paying bills" and "put off health care" because of cost or lack of insurance. By comparison, child care had become a minor issue.

The 2005 survey, the latest one, came as a shock because 16 percent of residents who responded said someone in their household had lost a job within the previous 12 months -- more than eight times the 1996 rate.

"We were surprised by it," said Sylvia Boeder, community relations director at Barrington's Advocate Good Shepherd Hospital, who heads a committee studying the issue.

The responses were puzzling because the economy generated more jobs than were lost in 2005. Yet the recycling created losers. Employers in the north and northwest suburbs shed more than 3,600 jobs that year because of shutdowns or restructuring, according to state data.

Barrington officials don't have answers, but they wonder whether job churn contributes to changes they see surfacing.

Deborah Villers sensed something was different several years ago when it came time to get ready for annual "Giving Day" in mid-December. Organizers invite needy families to a school gymnasium filled with donated toys, clothes and food.

Villers' job at Barrington Community Unit School District 220 was to prepare a mailing list of households that received free or subsidized school lunches. But unlike years past, the schools' allotment of 300 invitations wasn't enough to cover all the families. Unnerved, she pared the list to free lunch recipients, but there were still 50 too many. Familiar addresses leaped out at her. They were from affluent neighborhoods, not just lower-income communities on Barrington's fringes.

"They were all over the place, they were names you knew and recognized on this list," she recalls. "It was disturbing."

Activity is brisk at the non-profit Barrington Career Center, which served 600 people from 100 communities last year.

"The information that comes out from the Department of Labor makes it look like it's a really rosy picture, but that's not what we see at all," says Monica Keane, the center's director.

Linda Spinelli, out of work since her position as vice president of purchasing for a local home builder was eliminated in February, visited the center for the first time this spring.

She scanned the sign-in sheet, her eyes jumping down the titles -- general manager, director, senior analyst -- and former employers -- Motorola, Bank of America, R.R. Donnelley, Allstate. "Whoa, these are heavy hitters, people in the same position I'm in," the Barrington resident recalls thinking.

Unemployment is lower for better-educated workers than for other workers, in good times as well as bad, federal data show. But college-educated workers lose jobs more often now than they did 20 years ago.

"It appears that there has been an upsurge in job-loss rates for more-educated workers in the early and mid-1990s and again in the new century," writes a leading job-loss researcher, Princeton University's Henry S. Farber. "Job-loss rates for other educational groups show a cyclical pattern but no upward trend."

Income loss is greater too. The average earnings decline including lost raises was 21 percent for workers forced to find new full-time jobs between 2001 and 2003, four times the mid-1990s rate, Farber found.

Ray Ercoli heads a career ministry at Barrington's Willow Creek Community Church. He added volunteers and services in 2001 to help unemployed high-tech workers, but people kept coming after the economy recovered.

"The need we see now are older workers losing their jobs after being employed 15 to 20 years, usually at one company," he says. Some have that "deer-in-the-headlights look. They're not sure they're going to be able to land another job."

Richard H. Price, a leading researcher on the psychological impact of job loss, says the blow to self-esteem is heavy, especially for professionals. But the increased rates of illness, depression, anxiety and marital conflict that he and others documented among displaced U.S. workers stem mainly from the economic fallout -- the "cascade of stressors" flowing from reduced income and loss of benefits like health care, he says.

"People focus so much on the job loss itself, what they forget is you're plunging people into quasi-poverty," says Price, research professor at the University of Michigan's Institute for Social Research. "Even if a spouse is working they are going to be going through a lot of the issues others do. If they're a 50-year-old person who was moderately successful, their chance of landing another comparable job can be very low."

Fatigue from the pain of a herniated disc showed plainly on Carl Clouse's face, but he didn't let it color his voice. He stood at his desk, dialing prospective customers. If he didn't feel pressure to prove himself in his new job, he would be home taking care of his back.

Clouse got laid off for the first time in 2001 when Motorola eliminated his job as a senior manager in strategic marketing for an Internet software group. He had been with the company 16 years.

He operated his own marketing firm until his major client got sold last year. Then, six months after a trade show services company hired him as sales director in March, a new chief executive eliminated his position. "I just sucked it in. I couldn't believe it," he says.

He carried his belongings to his car and drove directly to the unemployment office, where the person who processed his application tried to reassure him by saying workers can expect to lose eight jobs in a career.

"You've only had two so you've done pretty good," the unemployment person said.

Clouse thought, "Six more times, I sure hope not."

For weeks he avoided leaving his Barrington home during the day because he didn't want his neighbors to know he was out of work. "It's tremendously embarrassing," he says. "Your self-esteem is shot."

Finally he started walking his 10-year-old son down the driveway to the school bus stop.

His new sales job pays one-third less than his last. His wife, a student at a local college, will hunt for work when she finishes her associate's degree.

Worry punctured the burst of pride he felt when his son recently made the cut for a soccer team. How would he afford the team's $1,575 in travel fees?

Vesna Arsic avoids Barrington, where she lived when she got laid off from a director-level position at Motorola in 2002.

She picked up the pieces and moved on, reinventing herself as an independent marketing consultant and selling her family's home to relocate with her son downtown. But the experience left a mark.

"It took a heavy emotional toll," she says. "I don't even like going back there. If somebody invites me to a party in Barrington, I don't like to go."

At a recent Tuesday morning networking meeting at the Barrington Career Center, the mood is determinedly upbeat. Unlike the dark years from 2001 through 2003, when it seemed nobody was hiring, people are getting interviews.

A former national account manager for an industrial supply company tells the group he was unnerved by the question, "I want you to describe yourself using nothing on your resume."

"It took me for a loop," he says. "I kind of fumbled around and finally said, 'I biked through the forest preserve for 12 miles this morning.' "

"Have you written a value statement?" one participant offers. "You could describe yourself that way."

Another job seeker declines an offer of help getting in the door at one of the area's blue-chip industrial companies. "They have an incredible turnover rate," he says.

"I think the turnover rate is pretty high everywhere," another job seeker says.

For some, such company is comforting. For others, it can be a depressing reminder that successful performance is no guarantee of steady work.

"The person I sat next to, I knew him from when his company was on the top of the game," Clouse says. "For me to see this gentleman on the curb, it blows me away."

Arsic, the marketing consultant, is philosophical: "To me, this is the new normal."

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berose@tribune.com