A desert for jobs and no end in sight

October 26, 2009

While millions of workers are struggling to get by on inadequate unemployment benefits, millions more are cut off completely as joblessness rises, reports Lee Sustar.

IF JOBLESS workers have to make a second visit to the unemployment office on Chicago's West Lawrence Avenue, an already big problem must be getting worse.

With the unemployment system mostly automated, most laid-off workers simply show up once to file, then update their status online or by telephone. So even though Illinois' jobless rate is 10 percent--the 14th highest among states--even late on a rainy Friday afternoon in October, the number of people in the office wasn't big. But their problems were.

The workers at the center--formally known as the Illinois Department of Employment Security (IDES)--are unfailingly polite, if a bit harried. "You have to wait until Obama extends the unemployment benefits," one told a client for the third--or maybe the fourth--time. But the claimant, an African American woman in her mid-thirties, lingered at the counter a moment further, in hope of some solution to the looming expiration of her benefits.

Standard benefits expire after 26 weeks, but Congress has extended the period, most recently in February. However, without another extension, 1 million people could lose their benefits by the end of year.

Long-term unemployment has broken all previous record levels
Long-term unemployment has broken all previous record levels (Michael Raphael)

Senate Democrats have proposed extending unemployment benefits by at least 14 weeks--and by 20 weeks in the 27 states where unemployment is higher than 8.5 percent. Republicans, who earlier this year opposed raising benefits through the stimulus package, are expected to quietly go along this time.

If benefits are extended, it would be a help to those who lost jobs in recent months--but many of the unemployed have run out of benefits long ago. And the problem is likely to get much worse before it gets better.

Long-term joblessness has broken all records, with 35.6 percent of all jobless workers out of work six months or longer. But even extended benefits can't undo or prevent enormous suffering. On average, unemployment benefits are just 38 percent of a workers' former wages, forcing many recipients to skimp on food purchases and delaying rent or house payments.

With benefits so low and jobs so scarce, some people drop by the IDES's Lawrence Avenue office to pick up flyers for free classes, tips on jobs or information on government services. Tellingly, the most prominent literature on display is a thick, glossy magazine--GI Jobs, aimed at veterans entering the worst job market in 26 years.

Many of the ads seem to be aimed at polishing corporate images rather than seriously offering employment. A spread promoting Schneider Trucking lists opportunities for vets--but the privately owned company imposed a pay freeze earlier this year and stopped paying into 401(k) retirement plans. There's another ad by Home Depot, which earlier this year eliminated 7,000 jobs and shut down its Expo stores.

But at least one ad aimed at former military personnel seems like it could lead to a job. Vinnell Arabia is seeking veterans for its "Saudi Arabian National Guard Modernization Program."

Yet even as wounded and traumatized Iraq and Afghanistan vets try to navigate a brutal job market, the military itself has become an employer of last resort.

The carnage in Iraq led to a steep drop in military recruitment a few years ago and spurred discussion of a new draft. But the recession has supplied the U.S. war machine with all the flesh and blood it requires. "The Pentagon's personnel chief, Bill Carr, said the military had completed its best recruiting year since 1973, meeting all its goals and bringing in a better-educated group of young people," the Associated Press reported.

FOR MOST people, of course, a trip to IDES isn't about finding work, but trying to obtain benefits that they urgently need.

Some are stunned to learn that they don't qualify for unemployment insurance benefits because they're classified as "independent contractors." This category doesn't include just freelancers and professionals like many computer programmers, writers and technicians, but employees who in previous decades would be considered employees--like FedEx Ground delivery drivers and many construction workers. Also losing out on unemployment benefits are part-time and low-wage workers in restaurants, retail and other service industries, even though they're eligible.

As a result of these evasions by employers and the patchwork of state laws, the number of jobless workers who received unemployment benefits varied widely in 2009, from 18 percent in South Dakota to 61 percent in Idaho, according to a study by the National Employment Law Project. With the jobs picture dramatically worse since then, the number of unemployed without benefits is certainly higher today.

Those who do qualify for unemployment pay often run into resistance from companies that try to deny benefit claims, or shortchange workers who do qualify. It was just such a dispute that brought one unemployed worker, Michael, to the West Lawrence Avenue office. An accountant, he'd been fired after confronting his boss over management's decision to pocket money that should have gone to workers' 401(k) savings accounts.

Like millions of other unemployed and underemployed workers, Michael is rankled by the fact that working people are enduring hard times while Wall Street bankers are poised to take home huge bonuses. That sort of greed creates an environment that affects even small operators like his former bosses.

"They said, 'We're in a money crunch,'" to justify ripping off employees. "But that's when your character shows--when the chips are truly against you," Michael said, adding that his employer wanted him to keep two sets of books--one to show the bank, another to keep track of what was really happening. The company also rigged the formal statement of employees' salaries to keep payments to unemployment insurance low, Michael said.

Apparently, Michael's employer is hoping that he'll keep quiet. Rather than say he was fired and fight the unemployment claim, they're calling it a layoff and are paying off--but only a portion of what's due him.

Incredibly, this was the second time Michael was fired for telling the truth about illegal practices by his employer. In 2000, he was canned by a subsidiary of the soon-to-be-bankrupt Enron for speaking up about the company's fraudulent claims that it could provide broadband Internet access to transmit movies.

"Based on what I've seen, there's a lot of corruption" in business, Michael said. "Why are we paying CEOs astronomical amounts when their businesses are failing? Prescription drugs have a 40 percent effectiveness rate. That's okay? If I got 40 percent on a test, I'd fail.

"I have no idea what to do. But I do know that people have got to be held accountable."

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