The REAL Unemployment Picture

By Johannes Werner March 31, 2010

Mari-Beth Parker was laid off in June after four years as a customer service representative with commercial real estate company Regus Group in Sarasota.

Sending out upwards of five resumes per day hasn’t landed her even one job interview. Now, her severance pay almost spent, she’s ready to file for unemployment. Says Parker: “I wanted to hold off as long as possible.”

Welcome to the growing ranks of the officially unemployed in Sarasota-Bradenton—13.3 percent of all working-age people as of March, much higher than the 11.9 percent state average.

This number landed the Sarasota-Bradenton metropolitan statistical area in the No. 325 spot out of 372 cities nationwide, in a tie with Decatur, Ill. Joining the likes of Flint, Mich., our metropolitan area will remain in the bottom 10th on the Labor Department’s unemployment ranking of U.S. cities for at least two more years, if state economists are correct.

According to the February forecast of the Florida Legislature’s Office of Economic and Demographic Research, Florida unemployment will peak at 12.3 percent this summer. That’s the good news. The bad news: Recovery or not, two-digit rates will continue to linger through the end of 2012.

Unemployment numbers can be misleading, however. To fully assess the economic havoc of the recession, consider just a few of the unreported casualties in our region: a former insurance case worker who now flips burgers and hawks Herbalife products, the full-time administrator who accepted the offer to work part-time when his employer morphed his former position into two half jobs,  the self-employed architect who must make ends meet with half the cash flow of two years ago, the out-of-luck job marketing expert who moved to Florida to live with Grandma after being unemployed for 18 months in her home state. And now, consider the bills that go unpaid and the homes and cars that get repossessed.

Lack of work and income affects at least twice as many working-age residents as the official unemployment rate suggests. As Florida International University’s Center for Labor Studies and Research explains in its 2009 State of Working Florida report, unemployment is a narrow measure of a much wider phenomenon. To gauge the true impact of lack of well-paid work on an economy, you must add underemployment, involuntary part-time employment and the long-term unemployed—those who maxed out official benefits and those who stopped looking completely.

While figuring in the gray zones is tricky, some official numbers are available. When discouraged workers, involuntary part-timers and marginally attached workers are included, unemployment in Florida would have been an average 8 percent higher in 2009, estimates the Agency of Workforce Innovation. That’s one in five people. About the same percentage of uncounted unemployed workers exists in Sarasota-Manatee.

What’s more, in late 2009 the average duration of unemployment in the nation surpassed six months for the first time since 1948, when the government began to track labor market figures.

And the experience of people like new Sarasota residents Michelle and Brian Chew, who don’t figure into local unemployment statistics, is likely to hang like a gray cloud over the economy for some time to come. After one-and-half years without a steady job, the couple is down to bare minimum and was forced to move in with relatives.

“We had a nice nest egg of about $10,000 saved,” Michelle says. “That’s almost gone.”

Michelle, who has a degree in marketing, lost her job as a program administrative assistant at a Colorado business incubator in 2008. She has been sending out hundreds of resumes since, to no avail. Brian left his seven-year job as a utility worker and kitchen helper in a retirement community in Colorado to pursue an opportunity in Wisconsin. But the opportunity never materialized, and the on-off handyman jobs he found didn’t begin to cover his expenses. Down on their luck, the couple accepted the invitation of Brian’s grandma in Nokomis to move in with her.

It’s not just about forfeiting cable TV and vacation trips—they have even switched to a carbohydrate-heavy diet.

“We don’t buy many vegetables because they’re too expensive,” says Michelle. “We eat the cheap, starchy food that’s not good for you.”

After hundreds of unanswered applications, she finally “got a hit,” as she calls it. Michelle is now going through training to sell insurance for AFLAC as an independent sales consultant.

And if that doesn’t work out? “We might be moving. Where? We have no clue,” she says.

The collective psychological impact of all these stories is powerful, according to Bruce Nissen, a sociologist affiliated with the Center of Labor Studies and Research at Florida International University. Even people who are employed stop buying consumer goods, and that means we’re going to be stuck in this recession a lot longer.

Economic guru Mohamed El-Erian, CEO of the world’s largest bond investment fund, puts it this way:

“Rates of unemployment in two-digit percent ranges can become a big problem if they persist,” he said in a recent interview published on his company’s Web site. “When you get to those levels, it changes the behavior of the employed, and it exerts even further pressure on public finances. When you see unemployment not just high but persistently high, even the employed become more cautious and begin to consume less.”

For one, expect a whole new generation of employees to permanently fall behind their older peers when it comes to salaries.

According to Yale economist Lisa Kahn, those who enter the job market during recessions and high unemployment take a lifetime hit on their earnings.

Also, an interesting sideline of Kahn’s long-term research shows that those whose careers started during a recession tend to be risk-averse later in their work lives, clinging to their jobs.

What can be done?

Much of the official answer on how to get stranded workers afloat has to do with education and training. And the region’s unemployed are taking more advantage of the skill-improvement opportunities offered by the Suncoast Workforce Board, says Sally Hill, spokeswoman for the area’s public employment agency. The number of SWB customers in training programs tripled from 102 in January 2009 to 306 a year later. But those students have to eat and feed their families in the meantime.

That’s where taxpayer-funded government transfer payments come into the picture. With longer-term unemployment settling in, Florida is extending the time period to get unemployment checks. Thanks to federal funding, state benefits have been extended from 26 weeks to a maximum of 46 weeks through July 31.

Worker advocates are also pushing to ease Florida’s restrictive eligibility rules for unemployment compensation—among the toughest in the nation—to make a bigger group of people eligible for unemployment benefits.

As it stands, the percentage of unemployed receiving benefits in Florida is low, according to Nissen.

“A lot of people who are unemployed don’t qualify under these complicated rules,” he says.

Finally, the state and U.S. Congress are debating whether to grant greater tax breaks to small businesses that create jobs. While saying there’s “some merit” to tax credits, Nissen is skeptical when it comes to its net job creation.

“Beyond that, I don’t see a lot we can tell private companies they should be doing. We can ask them not to behave like companies—cut profits while spreading wealth. But that would be telling them not to act in a capitalist manner.”

Because nothing else seems to work, Nissen and other job market analysts are suggesting massive New Deal-style state job creation programs. Two important sectors of the economy could use them.

As of summer 2009, manufacturing showed a long-term net loss in the number of jobs—a loss of 22 percent of employment from 2000 to 2008, due to outsourcing and shipping of jobs overseas, according to the Center for Labor Studies and Research at FIU in Miami.

Construction is also in for a long-term net loss. As of summer 2009, construction jobs in the state, which rose 30 percent between 2003 and 2006, had already seen their gains completely wiped out, falling back to 2003 levels.

But there are a few bright spots. Demand by some local employers is beginning to show signs of life. The number of help wanted online ads statewide rose by 25,500 in January compared to January 2009, according to The Conference Board, a nonprofit economy watchdog group. In Manatee County, there were 3,304 online Help Wanted ads during January, up from 2,092 in January 2009; in Sarasota, the improvement was even more dramatic, with 5,574 ads compared to just 2,765 a year ago.

Healthcare and education jobs continue to post solid numbers, as do technology jobs such as Web and graphic designers. The job postings on the Sarasota-Bradenton-based Web site in March were healthcare-heavy, according to Sarasotan Paul W. Dick, who launched the local job search Web site about 15 months ago. The greatest number of postings were for nurses and other healthcare jobs, medical-technical jobs, tech support jobs, Web and virtual basic programmers, and sales positions, most often with insurance companies.

Also, Florida still is among the happiest places to live in the United States, and that may be a factor that will help in the economic recovery. According to the latest four-year poll about happiness by the Center for Disease Control, Floridians were the third-happiest campers, after people in Louisiana and Hawaii.

Says Michelle Chew: “We want to stay and make it here. It’s beautiful, and there’s a lot of stuff that’s free.”■

▲ Taking on

Paul W. Dick, founder of Sarasota-based Professional Web Design, is encroaching on the turf of, the New York Times Corp.’s Herald-Tribune and craigslist.

In December 2008, he set up, and even though the regional job site has been promoted only by word of mouth, it has become an instant hit.  

The main attraction of is that Dick, who says he started the site “to give back to the community,” offers job postings at no cost. The only revenues are generated by marginal value-added services and advertising. As of mid-March, the site had 216 job postings and 5,759 job seeker accounts.

“I thought, wow, there’s really strong demand—let’s market the hell out of it,” Dick says, adding he is now beginning to look for advertisers who want to get in front of the local market.

The next step will be to expand coverage beyond Sarasota-Bradenton, from Tampa to Naples. Dick says he targets 50,000 accounts by year-end. The 1 million page views in 2009 could rise to 5 million this year, he believes.

Hot Jobs

Top Online Help Wanted Ads by occupation, Sarasota and Manatee

Occupation January January Percentage

2010 2009 Change

Physical therapists 400 272 +47.1

Registered nurses 363 489 - 25.8

Occupational therapists 343 308 +11.4

Retail salespersons 299 105 +177.1

Sales reps 275 125 +120

Speech-language pathologist 263 187 +40.6

Occ. therapist assistants 224 106 +111.3

Physical therapist assistants 177 140 +26.4

Retail supervisors/managers 169  90 +87.8

Executive secretaries 160  37 +323.4

Medical managers 156 117 +33.3

Telemarketers 139  46 +202.2

Customer service reps 132  61 +116.4

Insurance sales agents 114  82   +39

Hair dressers, cosmetologists 109  40 +172.5

Waiters, waitresses 106  39 +171.8

SOURCE: The Conference Board, prepared by the  Florida Agency for Workforce Innovation

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