Archive for category Jobs
American Dream Fades for Generation Y Professionals
The 32-year-old lawyer sold skin-care products in Houston before finding work as the assistant general counsel of a futures-trading firm where an irate customer punctuated a recorded voice-mail message with gunfire.
“No one was left with the impression that he just happened to be phoning from a sporting clays range,” she says.
Eighteen months and two busted jobs later, the daughter of a retired physician and a former editor at Vogue circled back to upstate and hunkered down at a small legal office that pays about one-quarter of her former $165,000 salary.
Generation Y professionals entering the workforce are finding careers that once were gateways to high pay and upwardly mobile lives turning into detours and dead ends. Average for individuals ages 25 to 34 have fallen 8 percent, double the adult population’s total drop, since the recession began in December 2007. Their rate remains stuck one-half to 1 percentage point above the national figure.
Three and a half years after the worst recession since the Great Depression, the earnings and employment gap between those in the under-35 population and their parents and grandparents threatens to unravel the American dream of each generation doing better than the last. The nation’s younger workers have benefited least from an economic recovery that has been the most uneven in recent history.
“This generation will be permanently depressed and will be on a lower path of income for probably all of their life — and at least the next 10 years,” says Rutgers professor Cliff Zukin, a senior research fellow at the university’s John J. Heldrich Center for Workforce Development. Professionals who start out in jobs other than their first choice tend to stay on the alternative path, earning less than they would have otherwise while becoming less likely to start over again later in preferred fields, Zukin says.
, who was chief economist at the White House Council of Economic Advisers in 2009 and 2010, says the shift to a downwardly mobile society may be lasting. “Children are not earning as much as their parents, and I think we’re laying the seeds for that to continue into the future,” he says.
Only one-fifth of those who graduated college since 2006 expect greater success than their parents, a Rutgers survey found earlier this year. Little more than half were working full time. Just one in five said their job put them on a career path.
Those who finish only high school or drop out fare worse. Almost four out of five jobs destroyed by the recession were held by workers with a high school diploma or less, according to’s Center on Education and the Workforce.
Middle-income jobs are disappearing for a wide range of young professionals. The number of financial counselors and loan officers ages 25 to 34 has dropped 40 percent since 2007, outpacing the 30 percent drop in total jobs for the profession, according to the federal Bureau of Labor Statistics.
Similarly, the number of hours logged by first-year and mid-level legal associates — a productivity measure of young lawyers — fell 12 percent from 2007 at some of New York’s largest law firms, says Jeff Grossman, national managing director of Wells Fargo Private Bank’s Legal Specialty Group in , . Yet profits per partner climbed $50,697 to $1.5 million on revenue of $66 billion last year, according to a separate survey of 86 of the world’s top law firms by The American Lawyer magazine.
“I had a lot of faith in the system, the mythology that if you work really hard you can achieve anything, and the stock market always goes up,” says 2009 law school graduate Elizabeth Hallock, 33. “It was pretty naïve on my part.”
Hallock is the named plaintiff in one of against some of the nation’s best-known law schools, including her alma mater, the University of San Francisco . The civil complaints, filed in 2011 and 2012, accuse the institutions of overstating graduates’ job-placement results and incomes.
Young Americans are struggling to reconcile their lack of economic rewards with their relatively privileged upbringings by Baby Boomer parents and the material success of their older peers, Generation X, born in the late 1960s and 1970s, says Kathy Sheehan, general manager of GfK Consumer Trends and Roper Reports, a unit of German-based research firm GfK.
“It’s a generation that had really high expectations, in some part driven by the way they were raised by their boomer parents,” she says. “Yet in the past five years they have had reality slammed in their face by the employment situation.”
About 61 million people, one-fifth of the , work at jobs where median earnings declined since 2007 even as the 1.2 million households whose incomes put them in the top 1 percent saw their pay rise 5.5 percent last year. Younger workers are experiencing the worst of the disparity in part because they’re being displaced by older workers. The number of employees ages 55 to 64 is expected to the under-24 working population by 2020 for the first time since at least World War II, according to the BLS.
Dashed expectations crimped even some of the most innovative corners of the economy. Daniel White was wrapping up a week-long vacation to two summers ago when a co-worker at Chicago-based called to share the news that White was about to be fired from the e-commerce discounter.
The 27-year-old business school graduate was living from paycheck to paycheck, cold-calling hair salons and pizza parlors in Youngstown, , from crowded offices at company headquarters when he found himself out on the street.
This year, White says, he hopes to earn $2,000 at his own startup Web-sales venture in Burlington, Vermont, seeing technology as the one path to potentially matching his father’s generation, “the people with the money and power.”
In more traditional jobs, the fallout from the subprime- mortgage collapse a half-decade ago continues to pummel people, including the architects who designed homes. The number of them ages 25 to 34 has fallen by 41 percent since 2007, compared with the total drop in the profession of 25 percent.
At the Seattle architectural firm of Callison LLC, faces and names began to disappear from the staff directory almost immediately after new hire Eli Hardi joined in January 2008.
“People would drop off on a daily basis,” says Hardi, 28, a recent graduate of a five-year architecture degree program in . Within a few months, Hardi rose from an hourly to salaried position. The promotion wiped out overtime pay and reduced his annual income by 12 percent to $39,500, he says.
Hardi worked through Christmas and New Year’s before being laid off during the first week of January 2009, 13 months after his hiring. He walked home in the cold to his apartment and new big-screen TV that was now a symbol of his uprooted ambitions.
“It’s a bit sudden, a bit jarring,” he says. Still, “there’s a certain sense of relief that you don’t have to deal with the sword hanging over your head. I almost felt worse for the people who had to stay, knowing they might lose their jobs.”
Architecture graduates ages 25 to 29 had the highest of 57 degree programs surveyed by the Education Department in 2009. Their 9.6 percent jobless level rivaled the 10.6 percent unemployment for all Americans ages 25 to 29 that year, including those without college degrees. Nursing fared the best with a 1.5 percent jobless rate.
“The hours were long, the pay was low and we got a notice saying the bonus would be minimal,” he says. “The hardest part, I found, is to maintain your own self respect and dignity.” In March, he quit to join a smaller firm where he works on historical renovations.
The same housing crash that hammered young architects and loan officers also slammed lawyers. Law schools are turning out about 45,000 holders a year for about 25,000 full-time positions available to them, according to the National Association for Law Placement Inc. in Washington. The class of 2011 had the lowest placement with law firms, 49.5 percent, in 36 years.
“It is not the perfect path to wealth and success that people may have envisioned,” says Robin Sparkman, editor in chief of The American Lawyer magazine in New York.
Some of the disenchanted have taken their complaints to court. Plaintiffs’ attorneys and recent law-school graduates are pushing to change what they call law schools’ overstated reports of post-graduation employment numbers. The results are used in magazine rankings of the institutions and to recruit new applicants. In state-court lawsuits, the former students allege false advertising and consumer fraud.
The claims are “meritless,” says Angie Davis, spokeswoman for the University of San Francisco . “We are sympathetic to the difficulty faced by law school graduates nationwide in finding employment on the heels of the Great Recession,” she says, adding the university helps students find work, and many have found “successful, rewarding careers.”
This July, San Francisco County Superior Court Judge Harold Kahn allowed lawsuits against USF and Golden Gate University to proceed, ruling that some law-school graduates may have a basis for claims that they were deceived. Judges in Illinois and rejected similar complaints.
“It’s hard to look at the information the schools were putting out and say it’s not misleading,” says Derek Tokaz, research director of the nonprofit Law School initiative. It published research showing that the chance of recent graduates getting permanent full-time work in law was far lower than the 80-95 percent total employment rates the schools typically boasted.
Tokaz, 28, worked with Tretter-Herriger at the Manhattan law firm of Curtis, Mallet-Prevost, Colt & Mosle LLP. She joined the firm in September 2008, the same month that Lehman Brothers Holdings Inc. collapsed, gradually setting off panic on and around the world.
The late nights and long weeks awaited by first-year associates as a grueling rite of passage didn’t come, she says. Instead, there was so little work to do that the hedge fund lawyers and recruiters she worked with frequently retreated after lunch to a street-level pub to watch English soccer.
Tretter-Herriger says she and some other first-year associates were fired 13 months later with the proviso they could keep their desks and look for jobs through October. She found one at the Houston futures trading firm. When it later outsourced some of its legal work, she moved on again and answered an ad on Craigslist for a job in Buffalo, New York.
She now complements her $45,000 lawyer’s salary by training horses and giving riding lessons. She says she’d like to buy a rental property and become self-sufficient in case she loses this job.
“As it is, all of my possessions still fit in the back of my truck,” she says. “I can pack it in a couple hours, pick up the trailer and horses and move anywhere the gas tank will take me at the drop of a hat. What can the system take away from you when you have that kind of freedom?”
- American Dream Fades for Generation Y Professionals (redalertpolitics.com)
- American Dream Fades for Generation Y (dailypaul.com)
- ‘American Dream Fades for Generation Y Professionals’ (cryptogon.com)
- The American Dream: Poor or Prison (truth11.com)
- An American Dream (linesbylinda.wordpress.com)
- Ian Ruhter: The Alchemist Chasing the American Dream (urbantimes.co)
- Poll: 63 percent of college grads think the American Dream is dead (redalertpolitics.com)
- David Koch Gave $50 Holiday Tips at 740 Park Avenue: TV – Bloomberg (bloomberg.com)
- From American Dream to American Reality: Gen Y Coming of Age (thenarcissisticanthropologist.com)
- Mohawk John Kane ‘My Sovereignty is not the American Dream’ (bsnorrell.blogspot.com)
Jobless Rate Falls to 7.8%, Lowest Since January 2009
By SHAILA DEWAN
Published: October 5, 2012
John Moore/Getty Images
Job applicants met with potential employers at 7 World Trade Center in New York last month.
The nation’s unemployment rate dropped below 8 percent in September to its lowest rate since the month President Obama took office, the Labor Department said Friday.
While employers added only a modest 114,000 jobs last month, the jobless rate declined to 7.8 percent from 8.1 percent, even though more people entered the labor force.
Adding to the positive news, job gains were revised upward by 40,000 for July (to 181,000) and by 46,000 for August (to 142,000), which had been considered a disappointing month, casting a slightly rosier hue on the summer slowdown.
The private sector, which has been adding jobs since March 2010, grew by 104,000 workers in September. Governments, where cuts have been a drag on the recovery, added 10,000 jobs.
Manufacturing, one of the bright spots that Mr. Obama has showcased throughout the re-election campaign, fell 16,000 jobs after losing a revised 22,000 in August, and construction jobs grew by 5,000. The number of temporary jobs, usually considered a harbinger of future growth, fell 2,000.
Coming a month before the presidential election, the jobs report offered ammunition for both sides as the candidates vie to convince voters that each is better equipped to steer the economy.
Mr. Obama can point to the 24th straight month of overall job growth after a severe financial crisis and a drop below the stubborn 8 percent jobless rate that has dogged his presidency. Republicans can — and did on Friday — continue to criticize the slow pace of improvement.
Mitt Romney, the Republican presidential challenger, took particular issue with any positive interpretation of the report.
“This is not what a real recovery looks like,” he said in a statement. “We created fewer jobs in September than in August, and fewer jobs in August than in July, and we’ve lost over 600,000 manufacturing jobs since President Obama took office.”
Representative Kevin Brady, a Republican from Texas and vice chairman of the joint economic committee, said the drop in the unemployment rate “was driven primarily by an increase of 582,000 in the number of workers employed involuntarily in part-time jobs. These workers need and want full-time jobs.”
“If not for all the people who have simply dropped out of the labor force,” Mr. Romney said in his statement, “the real unemployment rate would be closer to 11 percent.”
Representative Eric Cantor of Virginia, the majority leader, conceded that numbers were an improvement but added, “it simply isn’t good enough.” A jobless rate of 7.8 percent “should not be cause for celebration.”
Senate Majority Leader Harry Reid, Democrat from Nevada, countered that “with unemployment dropping below 8 percent to the lowest level in four years, our economy is on the right track.”
Consumers and businesses, too, seem to have divergent views of the economic situation.Consumers have shown increasing confidence as stocks rise and home prices stabilize.
Business leaders have been hanging back, though, more focused on global economic slowing and domestic concerns. They say they are uncertain what the election will mean for the business climate and are waiting in part for a resolution of the so-called fiscal cliff, a host of tax increases and budget cuts that will be triggered at the end of the year if Congress fails to act.
Harry Kazazian, the chief executive officer of Exxel Outdoors, a maker of camping equipment in Alabama, said the election, the fiscal cliff and rapidly shifting regulations had put him in a cautious mood.
With sales on the rise, Exxel has restarted a capital investment plan that it suspended three years ago, but is doing so slowly. “We’re moving forward, but we’re doing it in steps rather than being much more aggressive and putting ourselves out there,” Mr. Kazazian said. “I wouldn’t be surprised if things start turning the other way, meaning down.”
But at a Walmart in Atlanta, shoppers were loosening the reins a bit, buying what they described as small indulgences like scented candle oil and seasonal beer.
Linda Avery, 50, a food service manager, said her income had not changed but her daughter had moved out of the house, reducing her food and utility expenses.
Michael Peacock, 43, said that although his house was in foreclosure, his chosen field, online marketing, was improving to the point where he could even turn down some jobs that were outside his specialty.
“I can see people shopping,” Ms. Avery said, surveying the store. “You just feel like things are getting a little better.”
The polling firm Gallup pinpointed September’s rise in consumer confidence to the first day of the Democratic National Convention, and said it was almost entirely because of increased optimism among Democrats, while confidence among Republicans held steady at low levels. But Gallup could not say whether politics or improving economic conditions drove the change.
The discrepancy between consumers’ mood and the outlook of companies can be easily explained, economists said. “Businesses are much more forward looking,” said Ellen Zentner, the senior United States economist for Nomura Securities International.
Concerns over the fiscal cliff had begun showing up in business surveys in April, she said. “It’s been weighing on their investment and hiring decisions for quite some time.”
In a survey of 400 chief financial officers conducted this summer, Grant Thornton, a management consulting firm, found that many had shifted from neutrality to pessimism, with 45 percent of respondents saying they expected their work force to hold steady and 18 percent saying they expected it to shrink over the next six months. A large majority said they expected both health care costs and salaries to increase.
Stephen Chipman, the chief executive of Grant Thornton, said there appeared to be genuine growth in the technology, high-end manufacturing and energy sectors, while growth in health care was largely a result of consolidation and increased efficiency, and financial service hiring was largely driven by the need to comply with more regulations.
Before Mr. Obama took office, he pledged that his stimulus plan would keep unemployment from rising above 8 percent, based on projections that greatly underestimated the depth of the recession. Instead, unemployment has exceeded 8 percent since February 2009, peaking at 10 percent in October of that year.
There are now almost the same number of jobs as there were when Mr. Obama took office, but there are 426,000 more than when the economy stopped hemorrhaging jobs in February 2010. A mere 62,000 increase in the number of jobs would allow Mr. Obama to claim a net increase in jobs over his tenure.
This year, the economy has added an average of 146,000 jobs a month. Economists say that job growth of 100,000 to 175,000 a month is essentially neutral in terms of its effect on the election, while anything higher would favor the incumbent.
The government’s first estimate of September’s payrolls, while eagerly awaited, is less than precise and will be revised in coming months as more data is collected and verified. In an annual recalibration last month, the Bureau of Labor Statistics estimated that there were actually 400,000 more jobs added in the 12 months that ended in March than was previously thought. That benchmark will not be incorporated into the monthly jobs figures until early next year.
“The economy seems since the recovery began to have three gears,” said Patrick O’Keefe, a labor economist and director of economic research at J. H. Cohn, an accounting firm, “slow, idle and reverse. It’s stuck in slow. We don’t have a gear faster than slow.”
- U.S. jobless rate falls to 7.8 percent, 44-month low (triblive.com)
- Jobless rate falls to 7.8%, lowest in almost 4 years (miamiherald.com)
- US Jobless Rate Declines to 7.8%; 114000 Jobs Added – Bloomberg (bloomberg.com)
- US jobless rate falls to four-year low (telegraph.co.uk)
- US Jobless Rate Falls to 7.8 Percent, 44-Month Low (sandiego6.com)
- U.S. Jobless Rate Falls Below 8 Percent, 44-Month Low (wspa.com)
- U.S. jobless rate falls to 7.8%, 44-month low (newsday.com)
- 114,000 New Jobs Lowers Jobless Rate By .3%? (sweetness-light.com)
- US jobless rate falls to 7.8 pct., 44-month low (newsobserver.com)
- 7.8%: Jobless rate lowest in 4 years (abc15.com)
House Republicans’ New “Job Creation” Bill Creates No Jobs, Increases Workplace Abuses
Only the House Republicans could construct a jobs measure that divides the employed and unemployed, without creating a single job.
Anyone wondering why public disdain for Congress is sky high need look no further than the latest stunt by House Republicans: In response to Americans’ top priority—more good jobs—the House passed a radical anti-regulation bill on Thursday that not only cynically pits people who have jobs against those desperate to find them, but also threatens public health and workplace safety—without creating a single good job.
The centerpiece of the House effort is a provision stating that no agency may take “any significant regulatory action” until the monthly unemployment rate is “equal to or less than 6.0 percent.” Laughably touted as a “job creation” measure, H.R. 4078’s true aim is to bring federal regulation to a grinding halt and eviscerate public safeguards across the entire range of federal agencies in one fell swoop.
With few exceptions, the House proposal would mean that federal agencies may not adopt any new rules—or even write or seek public comment on rules—until the unemployment rate drops down to levels not seen since 2008. It may be 2017 before we get back to that point, according to the Congressional Budget Office and Office of Management and Budget.
Meanwhile, urgently needed reforms would be cast into indefinite limbo. Occupational safety measures would be delayed at a time when there are three million annual injuries and illnesses that workers suffer on the job – injuries that could land workers in the unemployment line themselves. The 2.5 million home care workers currently excluded from basic minimum wage and overtime lawsthat most of us take for granted would have to wait many more years for these protections—never mind that increased pay in their pocket could help boost demand and hiring.
For the architects of this effort, it seems the solution to the unemployment crisis is to put people with jobs in danger and to leave them vulnerable to workplace abuses such as wage theft. While employers get off scot-free, unsafe and unfair workplaces are the sacrifice that one group of workers should be willing to make for those searching for work, even if there’s no evidence that this unscrupulous trade-off would solve the plight of the unemployed.
The cynicism of House leaders in holding good jobs hostage to an ongoing unemployment crisis that they are doing nothing to address is simply breathtaking.
Let’s keep in mind that the biggest hindrance to hiring is not over-regulation but lack of demand, according to numerous surveys conducted by the American Sustainable Business Council, the Main Street Alliance, the Small Business Majority, the McClatchy/Tribune News Service, and even the U.S. Chamber of Commerce. Also keep in mind that the current White House has issued fewer final regulations than any administration going back twenty years. And consider this irony: The American Chemistry Council recently requested new regulations from the FDA in order to bolster consumer confidence in the safety of their plastic products.
There are more productive ways for Congress to spend its time. Passing the Fair Minimum Wage Act of 2012, introduced in the U.S. Senate and House of Representatives last week, would raise the spending power of millions of struggling workers and their families and increase consumer demand. Addressing the infrastructure problems that have left millions of Americans sitting in the dark this summer by improving the power grid and developing alternative energy sources would also put unemployed workers back on the job.
Allowing the quality of our workplaces to deteriorate for years at a time is no way to build a solid economic recovery with good jobs as its foundation. Leaders in Congress owe it to the American people—those with jobs, and those who want to work—to stop spinning their wheels and wasting time on partisan stunts and cynical legislation like H.R. 4078 and its ilk. With nearly four months remaining until the next election, congressional leaders need to get down to business and do the serious job of putting America back to work.
- House Republicans’ New “Job Creation” Bill Creates No Jobs, Increases Workplace Abuses (alternet.org)
- House Republicans’ New “Job Creation” Bill Creates No Jobs, Increases Workplace Abuses | Alternet (tribuneofthepeople.com)
- Seed Accelerators Have Created Nearly 3,500 Jobs (grasshopper.com)
- House Republicans Sacrifice Human Health For Alleged Job Creation (desmogblog.com)
- 7 Reasons Why Romney-Ryan’s Desperate Attempts to Spin Medicare Won’t Work | Alternet (mbcalyn.com)
- 5 Things You Can Expect from Washington if You Elect Republicans | Alternet (mbcalyn.com)
- Can we call it class war yet? (salon.com)
- High-Growth Firms Account for Disproportionate Share of Job Creation, According to Kauffman Foundation Study (kauffman.org)
- Rick Scott in Tampa for release of July jobs report (tbo.com)
- Job Growth in U.S. Driven Entirely by Startups, According to Kauffman Foundation Study (kauffman.org)
Silicon Valley Creating Jobs, But Not for Everyone
Pundits will hash and rehash the impact of today’s jobs report on the president’s chances in November. But it’s the Labor Department’s regional employment figures for June that should unsettle both candidates.
If there’s one talking point Obama and Romeny can agree on, it’s that innovation creates jobs. By one metric, the regional jobs report supports that seemingly no-duh assertion. The metro region that includes Silicon Valley led the country in job growth, posting a 3.8 percent increase compared to the same time last year. San Francisco followed close behind with the second-highest growth rate at 3.6 percent.
Unsurprisingly, tech jobs led the way. Facebook is hiring. Twitter is hiring. Google is hiring. Startups are hiring. Rents in San Francisco have soared as young tech workers compete for scarce real estate. Tech industry boom times create a weird parallel universe effect. Headlines about the nation’s economic stagnation drone on, but in the Bay Area new restaurants selling $9 grilled cheese sandwiches and $10 cocktails seem to open daily.
But the other key measure of the region’s economic well-being undermines the uncritical optimism politicians tend to lavish on tech. In Silicon Valley, this nation-leading hub of economic vitality and job creation, the unemployment rate in June was 8.8 percent, an increase of nearly half a percent from May, and well above the national average. To be sure, the current rate is a big improvement compared to June of last year, when 10.2 percent of the region’s labor force was out of work. But shouldn’t a place as exceptional as Silicon Valley be able to do better than that? Shouldn’t such an engine of economic vitality stand out more in its prosperity compared to the rest of the United States?
In the definitive annual report on the state of Silicon Valley’s economy, the Silicon Valley Index, researchers earlier this year found that jobs for highly educated workers abound. Average incomes are on the rise, fueled by hot competition for talent among mobile, internet, social media and cloud-computing companies. Yet the Index also found that median incomes have fallen, and more students are receiving free or reduced-price lunches — a standard measure of economic hardship. In other words, as some workers make notably more money, more workers are making less. Today, many of them are still not finding work at all. As I’ve written about before, tech’s trickle-down effect looks weak on the local level. The industry creates jobs for some, but not for all.
Academics have nicknamed this phenomenon the “hollowing out” of the U.S. economy. Highly skilled, highly educated workers do increasingly well in an increasingly specialized economy driven by knowledge work. Their prosperity feeds demand for low-paying service work. But when tech companies grow, they no longer create the kind of medium-skilled, middle-class jobs they did in the past. Facebook doesn’t need factory workers.
“You can have companies doing well and you can have all this startup activity, but it no longer means lots of jobs,” said Russell Hancock, president of Joint Ventures, which publishes the Silicon Valley Index. “That’s the reality, and it’s going to be that way from here on out. You don’t need all the people you used to need.”
Hancock tells Wired he believes the hollowing out of Silicon Valley reflects not a temporary condition but a basic structural change. The shakeout has just started, he says, as newer tech companies seek to stay lean and nimble and old-school Valley companies try to look more like the new ones. Companies don’t seek the talent that’s closest to home — they seek the best people in the world, wherever they may live. We all need to view ourselves as startups in this new economy, which means a willingness to reinvent ourselves, Hancock says.
But as anyone in Silicon Valley knows, startups fail fast and often. It’s the winners who make headlines. The losers simply fade into the dustbin of history.
“We used to have an economy that had absorption capacity. It could provide opportunities for the whole,” Hancock says. “Now we have an economy that’s brutal, an economy that only rewards people at the high end. The rest I don’t know. I don’t know what’s going to happen.”
- Markets: Silicon Valley Creating Jobs, But Not for Everyone (wired.com)
- Silicon Valley job growth roars back (venturebeat.com)
- Amazon Lockers make a quiet debut in Silicon Valley (geekwire.com)
- This Brave Soul Moved To Silicon Valley From Atlanta To Kill Pinterest – And Just Needs A Developer (businessinsider.com)
- Too hot for jobs (economist.com)
- Who was hiring in Silicon Valley in June? Microsoft, for one (bizjournals.com)
- Hot times in Silicon Valley (economist.com)
- Young Silicon Valley entrepreneur from south London sells online business for six figure sum (standard.co.uk)
- 3 Things to do with Kids in Silicon Valley (mountainviewfun.com)
- Silicon Valley Boot Camp Aims To Boost Diversity (npr.org)
According to an analysis made by Challenger, Grey and Christmas, layoffs in the tech sector reached their highest level in three years during 2012′s first six months. CGC is the nation’s first, largest and oldest executive placement organization.
From January through June, 51,529 planned job cuts were announced. In the aggregate, they represented a 260 percent increase over the 14,308 estimated layoffs during the first half of 2011. The employment picture to date this year is so grim that projected job reduction exceeds by 39 percent all total cuts in the tech sector recorded last year.
Among the most prominent corporate names slashing staff is Hewlett Packard. By the end of 2014, HP will eliminate 27,000 jobs (8 percent of its work force). Under the direction of failed California gubernatorial candidate Meg Whitman, HP will reinvest the payroll savings into research and development.
The 2012 gutting comes on top of a miserable 2011 when Bank of America announced 30,000 cuts. Large-scale layoffs also came from pharmaceutical firm Merck (13,000), Sam’s Club (11,000), and Borders Group, Inc.(11,000).
The worst may be yet to come. John Challenger, CEO of CGC, said:
“We may see more job cuts from the computer sector in the months ahead. While consumers and businesses are spending more on technology, the spending appears to favor a handful of companies. Those that are struggling to keep up with the rapidly changing trends and consumer tastes are shuffling workers to new projects or laying them off altogether.”
Apparently, neither President Barack Obama nor presumptive Republican nominee Mitt Romney read the Wall Street Journal.
Both have made liberalizing non-immigrant worker visas, specifically the H-1B, a campaign priority. One preposterous proposal both support is stapling a green card to any university diploma earned by foreign-born students in the Science, Technology, Engineering and Mathematics (STEM) field. With nearly 60,000 Chinese nationals alone currently enrolled in related study areas, the destructive impact automatic work authorization would have on unemployed Americans is incalculable.
A good example of how the H-1B visa system works in the real world was described in a 2011 lawsuit filed against Molina Healthcare Inc., which handles Medicaid and Medicare paperwork for the federal government, and Cognizant Technology Solutions Corp., which recruits H-1B workers in India. On January 14, 2010, one day after the Department of Labor approved Molina’s application for 40 H-1B workers, Molina fired approximately 40 competent U.S. programmers, managers and analysts and hired 40 H-1B replacements imported by Cognizant from India.
James Otto, a lawyer representing the fired workers said:
“They [Molina executives] just wanted to fire the Americans and that’s what happened. It wasn’t a downsizing, it wasn’t an outsourcing, it was bringing in foreigners onto American soil to replace American workers. That [was] the scheme and it’s going on around the country.”
Despite all the campaign lip service Obama and Romney give to job creation, they willfully continue to overlook the obvious: there’s a surplus of American workers and each visa issued that includes a work permit is a threat to American employment.
- Hewlett-Packard Punch Up. Is it Mortal Combat for Jim Chanos and Meg Whitman $HPQ #deliveringalpha (financialskeptic.wordpress.com)
- Whitman’s lesson for Romney – Unemployment – Salon.com (mbcalyn.com)
- Mitt Romney Offers Ill-Timed Praise For Meg Whitman (huffingtonpost.com)
- Meg Whitman’s Big Hewlett Packard Move: Firing 30,000 Workers (inquisitr.com)
- HP Will Announce Layoff Details This Afternoon (news.dice.com)
- Mitt Romney praises Meg Whitman as she prepares to lay off 30,000 workers (dailykos.com)
- Just By Itself, HP Increased Tech Industry Layoffs Tenfold This Year (HPQ, IBM) (businessinsider.com)
- More Bad Company For Mitt (washingtonmonthly.com)
- Hewlett-Packard To Cut 30,000 Jobs Today. Meg Whitman, CEO, Shed’s Light On Future (theobamacrat.com)
- Whitman’s lesson for Romney (salon.com)
- Twin Cities rank 16th for H-1B visas (bizjournals.com)
- Seattle’s near top in foreign workers on H-1B visas: report (bizjournals.com)
- Study: 2,100 skilled foreign workers got visas in Denver area (denverpost.com)
- Brookings H-1B report draws criticism (pcadvisor.co.uk)
- Delink H1-B visa from politics: Brookings (thehindu.com)
- Denver-area employers sought visas to land skilled foreign workers (denverpost.com)
- Denver attracts dollars, skilled workers through H-1B visa program (denverpost.com)
- Seattle may be missing out on cash for workforce training (mynorthwest.com)
- How Do I Get A US Work Visa? (essentialtravel.co.uk)
- Survey finds which companies use high-skill visas (kansascity.com)
Is the US Losing its Lead in Innovation?
The OECD has just released its Economic Survey of the United States, and once the word gets out, the report is likely to spark a lot of interest among the chattering class. The argument will focus on the report’s statement that “fissures have begun to appear” in the US lead in innovation.
Here’s a bit from the report’s overview:
To foster innovation and economic growth, reductions in the federal R&D budget should be as limited as possible. Ideally, funds would be appropriated to continue on the path approved in the 2007 America COMPETES Act of doubling the budgets for three key science agencies within a decade. Patent reform should be taken further than in the America Invents Act by ensuring that the legal standards for granting injunctive relief and damages awards for patent infringement reflect realistic business practices and the relative contributions of patented components of complex products. In light of spillover benefits from manufacturing activity, the measures proposed by the Administration to strengthen manufacturing competitiveness should be implemented. Education reform is needed to strengthen achievement and to address lagging tertiary attainment in the fields of science, technology, engineering and mathematics (STEM).
Does anyone believe that any of these things will occur? The US Congress
can’t even agree on what day of the week it is, much less on a strategy to foster US innovation.
And spend more money? Now there’s a non-starter. Or support the Obama administration’s plan to strengthen manufacturing competitiveness? Not in this lifetime. Or more funding for education? Just the opposite is the order of the day.
The report also has some harsh things to say about the rise of income inequality in the US:
To reduce both income inequality and distortions in resource allocation, tax expenditures that disproportionately benefit high earners should be limited over time. In particular, effective tax rates on debt-financed corporate investment and housing should be equalized at the higher rate on equity-financed corporate investment while simultaneously lowering the corporate tax rate.
Perhaps the OECD doesn’t understand the full implications of the current political stand-off in the US. Sometimes it seems that technocrats live in a parallel universe, and this is one of those times.
- Is the US Losing its Lead in Innovation? (247wallst.com)
- Daniel B. Ravicher: Where Are All the Jobs Patent Reform Promised? (huffingtonpost.com)
- Reforming vs reinventing (ashleytan.wordpress.com)
- Docs at BIO: Steve Burrill’s State of the Biotech Industry Report 2012 (patentdocs.org)
- My Encounter With a Patent Troll (ecommercefuel.com)
- ‘Patent trolls’ cost tech companies $29 billion last year, study says (techworld.com.au)
- “Innovation, an answer to Crisis” by Dominique Delport, CEO Havas Média France (slideshare.net)
- Wall St. Journal Nominates “Innovation” as Most Overused Word in 2012 (birnbachcom.com)
- New Evidence Arrives to Support Patent System Overhaul While EFF Pressures Congress (techrights.org)
- Economic Scene: Tech Lawsuits Endanger Innovation (nytimes.com)
NHL players ready for a fight, hope for best
Fehr seeks fast resolution when negotiations start Friday
Blackhawks captain Jonathan Toews. (Phil Velasquez / Tribune Photo /June 27, 2012)
6:38 p.m. CDT, June 27, 2012
Until the NHL Players’ Association sits across the table with the league and exchanges proposals, it won’t know what kind of fight it’s in for during negotiations on a new collective bargaining agreement.
If it comes to it, the union appears willing and able to drop the gloves after three days of executive board meetings that concluded Wednesday at a downtown Chicago hotel. The sides will meet beginning Friday in New York to attempt to reach a new CBA with the old one set to expire Sept. 15.
“Nothing would make us happier than to get to a resolution that everybody can find acceptable and do it in as fast and as least difficult manner as we can figure out,” NHLPA executive director Donald Fehr said, acknowledging that Commissioner Gary Bettman and other NHL officials have said they want “a quick and painless negotiation.”
The Blackhawks’ Jonathan Toews and Steve Montador were among players from around the league who flanked Fehr. Montador and fellow veteran Brendan Morrison will represent the Hawks on a 31-player negotiating committee that will aid the NHLPA in talks with the league.
Fehr pointed out that the NHL is coming off a season with record revenues and soaring TV ratings — among other positives — and said the goal is to keep things headed in a positive direction.
“When we approach these negotiations, the object is to get a deal done which can continue that momentum and continue it uninterrupted,” Fehr said.
History has not been kind to the NHLPA in recent labor negotiations, with the owners gaining major concessions from the union — including the implementation of the salary cap — following a lockout that caused the cancellation of the 2004-05 season. This time, the players appear resolved to win more of the battles.
“The players understand what happened last time — of course they do,” Fehr said. “A bunch of them lived through it. With respect to those who didn’t, they’ve been told by the guys that did. They understand that backdrop and they understand what took place. Every agreement that you make, however, stands on its own and you have to go forward.”
A total of 56 players attended meetings over the three days and they will inform their teammates of the issues and the solidarity the NHLPA displayed heading into the negotiations.
“You have to be confident in these situations,” Toews said. “You have to be confident in each other, especially the players amongst themselves. We’re going to keep working and learning together.
“(Both sides) want the same thing and have our priorities right,” Toews continued. “The ultimate thing that both sides want is a fair deal that is something both can compromise on and be happy about. And in the end give the fans what they want and that’s a great NHL product. We’ll see how that develops.”
- NHLPA head says CBA talks may start this week (sportsillustrated.cnn.com)
- NHL and players agree on $70.2 million salary cap, formal talks expected Friday – Toronto Star (thestar.com)
- NHL Labor Negotiations About to Begin (nytimes.com)
- NHL Labor Negotiations About To Begin (newyork.cbslocal.com)
- NHLPA head Fehr says players engaged in current labour process (cbc.ca)
- NHLPA sorts out labor strategy (nbcsports.msnbc.com)
- NHLPA head says labor talks are set to begin (espn.go.com)
- NHLPA head says labor talks may start this week (sportsillustrated.cnn.com)
- NHL labor negotiations about to begin (enterprisenews.com)
- NHL labor negotiations about to begin (seattletimes.nwsource.com)
Why You Can’t Braid Someone’s Hair In Utah For Money Without First Paying $16k
from the regulatory-control dept
The common wisdom that you’ll often hear is that industries hate regulations, and would prefer deregulation. And, in certain areas that’s definitely true. But, in others, industries wantregulation — but not for a good reason. It’s because legacy players realize two things: (1) they can often “control” the regulatory process (hello regulatory capture) to twist it to their own advantage and (2) it’s a really handy way to limit competition. We just recently wrote about some of the more ridiculous factors concerning teaching certifications. Lots of people pushed back in the comments arguing — correctly — that just because someone knows something, it doesn’t mean they’re a good teacher. But… there’s another point that we made in the post that many of those people ignored: just because you “certify” teachers, it doesn’t mean they’re any better at teaching. In fact, as our post noted, the research has shown no noticeable difference between certified and uncertified teachers. So you can make the argument all you want that certification is somehow “needed,” but if that certification doesn’t seem to help at all, it’s wise to at least question the certification process.
The same Planet Money folks who brought us that story recently did a podcast and a NY Times article on another example of regulatory ridiculousness. This one involved a woman who had built a small business braiding the hair of African children in Utah. The woman, Jestina Clayton, grew up in Sierra Leone, where she learned to braid hair, and when she ended up in Centerville, Utah, she discovered there was demand there, due to a large number of adopted African children, whose parents had no idea what to do with their hair. Then, someone threatened to “report” her for practicing “cosmetology” without a license. She checked it out and discovered that bizarre (but all too common) regulation made that true — but to get her license she’d have to go to school for two years at a cost of $16,000. All to braid hair. And, even more ridiculous, none of the schools taught anything having to do with braiding hair like Clayton did. It would be a pure waste.
If you can, you should listen to the Planet Money podcast on this, because they actually get a spokesperson from the “Professional Beauty Association” try to explain why the governmentmust regulate “professional beauty” practitioners before they kill again (well, only slight exaggeration). She does go on and on about the “consumer safety issues” of the people she’s supposedly representing. My favorite risk? “Open wounds.” From hair braiding?
Either way, Clayton went before the (I’m not joking) Barber, Cosmetology/Barber, Esthetics, Electrology and Nail Technology Licensing Board of Utah, to try to convince them to let her braid without a license. Apparently this became a big issue and “licensed cosmetologists” came out of the woodwork to argue against her — and her request was denied.
As the report notes: none of this is to necessarily say that all regulation is bad and that industries don’t need some sort of regulation. But, at the very least, if there is going to be regulation, shouldn’t there be some evidence that it’s (a) needed and (b) effective? Because, somehow, I don’t think that there’s a big risk from a woman braiding some kids’ hair in Utah.
- It’s the Economy: So You Think You Can Be a Hair Braider? (nytimes.com)
- Episode 381: Why It’s Illegal To Braid Hair Without A License (npr.org)
- Why It’s Illegal To Braid Hair Without A License (libertycrier.com)
- Why It’s Illegal To Braid Hair Without A License (wnyc.org)
- Why It’s Illegal To Braid Hair Without A License (npr.org)
- Episode 381: Why It’s Illegal To Braid Hair Without A License (wnyc.org)
- The New York Times Spotlights Occupational Licensing Abuse in Utah (reason.com)
- Taylor Swift’s Braided Updo Is Our New Favorite Thing (bellasugar.com)
- Why It’s Illegal To Braid Hair Without A License (wnyc.org)
- 6 Cool Ways to Wear Ponytail Braids (bellasugar.com)
Try Finding a Job Without a G.E.D.
Published: June 24, 2012
The General Educational Development test, which provides the equivalent of a high school diploma, is being revised to conform with the rigorous new standards proposed by the National Governors Association, along with state school superintendents. New York State and New York City will have to do more to prepare people for an exam that could help them get a leg up in the job market.
Far too many of the 50,000 New Yorkers who take the G.E.D. each year do so without preparation. The state pays only for the test and a $20 subsidy per test taker to help run the nonprofit centers that offer the exam, and the pass rate is a low 59 percent. The rate for Iowa, where students take a diagnostic test and receive remedial help at little or no cost, is 98 percent.
The New York City Council has a pilot project that funnels unskilled job seekers into test preparation programs. The results have been good — a pass rate of 83 percent — but with only a thousand people enrolled, the programs will need to be greatly expanded. The Bloomberg administration, with a grant from the MetLife Foundation, is trying to develop a model for educating more adult learners more quickly. At the same time, however, Mayor Michael Bloomberg has proposed zeroing out a program that, for the modest cost of $5.2 million, served an estimated 6,000 people who participated in adult education classes in 2010.
In addition to becoming more rigorous, the G.E.D. is moving from a paper-and-pencil format to an online system that state officials say will raise the state’s cost from about $58 per person for the current exam to $120 for the new test, which comes online in 2014.
The state is looking into the option of developing a less expensive exam in collaboration with other states.
These are the numbers that matter most: 2.3 million people in New York State without a high school diploma — 1.3 million in the city. The economy needs educated workers. Anyone willing to study for the G.E.D. deserves help.
- Editorial: Try Finding a Job Without a G.E.D. (nytimes.com)
- The G.E.D. Song (kluc.cbslocal.com)
- Beyonce Is Finally Getting Her G.E.D.! (997now.cbslocal.com)
- In Need, in New York – NYTimes.com (mbcalyn.com)
- Spoken Word Artistry ~ G.R.E.E.d.S & The Remedies (lapkat.com)
- Akil Prince: Help offenders to go straight (redding.com)
- Youth Business Network Project to connect at risk teens with jobs, skills (oclatinolink.ocregister.com)
- nys free online classes (eugenemasterson.typepad.com)
- At a Halfway House, Bedlam Reigns (nytimes.com)
- Justin Bieber Graduates From High School (kluc.cbslocal.com)