Working Two Jobs and Still Underemployed

[question everything]

DECEMBER 1, 2009

Working Two Jobs and Still Underemployed

By IANTHE JEANNE DUGAN
WSJ

For Richard Crane, the "new normal" in the labor market began when he was laid off from a New Jersey battery plant in the summer of 2006. Mr. Crane had been earning more than $100,000 a year operating heavy machinery at Delco, a former unit of General Motors. He worked there for 23 years, since graduating from high school. But when he lost his job he was thrust into a netherworld of part-time gigs: working the registers at Taco Bell, organizing orders at McDonald's, whatever he could find. "I thought it would be temporary," says Mr. Crane, 49 years old. Three years later, he is selling outdoor furniture by day and pumping gas by night, while worrying about his skills atrophying and spending scant time with his teenage son. He makes about a third of his former pay.

Mr. Crane is part of a growing group of underemployed -- people in part-time jobs who want full-time work or people in jobs that don't employ their skills. Since the recession began two years ago, the number of people involuntarily working part-time jobs has more than doubled to 9.3 million, according to the federal Bureau of Labor Statistics, the highest number on record. The proliferation of underemployed could represent a profound reordering of the employment structure. Many people who had comfortable full-time jobs with benefits and advancement opportunities now are cobbling together smaller jobs often at lower pay, in a shift that economists say could become permanent for many individuals stuck in the cycle. Underemployment, along with unemployment, is widely seen as a force slowing the economic recovery.

(snip)

Federal Reserve Chairman Ben Bernanke last week lamented in a speech to the Economic Club of New York that the number of underemployed is rising much faster than during previous recessions. And the average workweek has fallen to 33 hours, the lowest level in the post-World War II period. "These data suggest that the excess supply of labor is even greater than indicated by the unemployment rate alone," Mr. Bernanke said. The unemployment rate is now 10.2%.


Among the underemployed is Marty Rasmussen of Walnut Creek, Calif., who was a banking executive for more than 15 years. He and his wife earned a combined income of more than $250,000 a year. As a hobby, he built cabinets and furniture. Two years ago, he was laid off by a big bank in San Francisco. While job-hunting, he volunteered to build cabinets for a local Lutheran church, and some fellow parishioners hired him to do work. His onetime hobby became his sole source of income. In the last year, he earned more than $10,000 replacing windows and installing crown molding. He just finished a pair of nightstands commissioned by a friend paying $700. His wife also lost her job this year and is collecting unemployment benefits. "It is hard transitioning from hobbyist, because I'm used to giving my work as gifts," he says.

(snip)

Over the summer, Mr. Crane's electricity was shut off, he says. He paid the bill and had it restored. But he didn't pay the gas, which is about $175 per month. Instead, all summer, they cooked on the grill outside. Mr. Crane bought an electric hot water heater for baths and laundry. They lived that way for three months before finally turning the gas back on. Ultimately, many economists expect the underemployment situation to improve, but not for a few years. Companies are cutting back hours, so as they pick up, they are likely to return hours to current staff before hiring new people. Eventually, employment will pick up. But for people like Mr. Crane, the current situation could become permanent. As they work part-time, they have less time to look for work. Their résumés, meanwhile, become spotty. "If you have a string of jobs beneath your skills, it erodes your resume and marketability," says Ms. Shierholz. Mr. Crane no longer sees his new life as temporary. He no longer dreams of going and fixing equipment at the factory and operating big machines. "My new goal is to become a manager at Lowe's," he says. "That will pay $17 an hour. I'm hoping this happens in the next couple of years, by the time my son is in high school."

http://online.wsj.com/article/SB125962111284270397.html (subscription)

[imdjh]

1. Why would a job at Delco pay $50/hr?

Not envy or sour grapes- no, I have never made $50/hr, but I don't understand why a forklift or bulldozer operator would. Surely there would be a great deal of demand for that job, and men who would do it for $45, or $35/hr maybe even $20. That's how the market works. I don't begrudge anyone a good living, but how much can a high school graduate expect to make at an hourly job? I know plenty of high school grads, and one drop out who make that or more, but it's in their own business where their investment is at risk, not in a paycheck job.

[eilen]

2. Believe it or not

college is not the only way people learn skills. Particularly if one has to get their hands dirty. Honestly, industrial jobs are not just about screwing a widget together. It leads me to believe that most college grads would starve to death naked if they did not have Walmart and Costco.

[Festivito]

3. Working "heavy machinery" takes special people.

You would not want a temporary, a college trained engineer, or me running a crane over your head, it requires specific skills and especially a certain personal temperament to drop ten tons on a dime safely.

Sure, a simple job of running a forklift can pay $10 an hour. But, you won't want that for the special forklifts or for some loads. (Arrogant managers during a strike have cause hundreds of thousands of dollars of damage in minutes.)

Some factory jobs pay well over $100 per hour. Sure a lot of people want them, but not just any Joe or Joan is going to get it.

[imdjh]

5. MY argument is that there must be qualified people willing to do it for less.

I am aware that there are skills involved in operating heavy machinery. I am also aware that the demand for this skill and the supply of people who can do it would change over time. It takes skill to be an auto mechanic as well- but if you get more qualified mechanics than you have jobs, then the price goes down. Which is precisely why I want to have more young people in dental school and trade schools.

[question everything]

6. Some of it could be union contract (nt)

[Festivito]

9. And my answer was as to why that just doesn't easily happen.

Be aware that these people make good CEOs as well. Not bad ones, good ones. They can and do run their own businesses on the side while never missing a day at the heavy machinery. You can't just train someone. The supply does not "change over time." The supply is few, and probably relatively constant compared to population. And the analogy to auto mechanics is false.

More like a diesel mechanic for one of those two-story tall engines with twenty cylinders running the five-story tall earth movers. When you're losing $1,000 per hour on a big job, or $100,000 per hour in a factory line, you don't want a $10-$20/hour podunk kid who then goofs causing a fixable solution to become two days of losses that will stop your career.

Foregoing a CEO job for $250,000 + $250,000 bonus for relative security of a larger company at $200,000 plus overtime and time to run some other stuff on the side is not a bad tradeoff for these people. You think you can do it for less? Maybe now you can since CEO pay is down, at least for real companies that produce real items it's down. (The companies producing banking for example can't figure out what they do so they charge more and more trying to compensate for being leeches and all too possibly underendowed.)

This is not some simple minded Ayn Randian circumstance.

[NMDemDist2]

4. he probably worked a lot of overtime

and with seniority it would be easy to top $100k

but i doubt his hourly was $50, more like $25-30 and hour

[proudohioan]

7. I think you people are missing the point of the story.

I think the point was that there a lot of people who once had very good, or at least decent jobs, who are now thrust into the throws of the new economy: Wal-mart jobs with Wal-mart wages. Underemployment has now become the norm for a lot of us. People like this Mr. Crane thought the part-time job situation was temporary. So did I...... yeah, it's just temporary, and I'll continue to apply for "real jobs" while I'm here.... OK, good intentions, and at first, I was at least getting some interviews, if not the job. But it kept my hopes up, anyway. After a while, the interviews got fewer and farther between. Everything seems to be "apply on line at www.addyourowncoporation". No responses at all. Pretty soon, you are writing down names of places you have applied at on-line and researching the corporate websites to find some kind of a contact number so that you may make an inquiry as to the status of your application and/or resume.

All of this starts to become more time consuming and frustrating. Add to that the fact that anyone who has ever worked in the retail/service sector world knows that you have no set schedule: you look at the newly posted schedule every thursday or friday afternoon to see what days and hours you are scheduled to work for the next week. Chances are, there is no consistency. That leaves it hard to schedule an interview for the potential employer that wants you to be able to come in within the next few days. Call in sick?

Pretty soon, at some point, you just give up.... it becomes too disheartening to even thumb through the newspaper want ads or surf Monster.com. If you had office skills at one time, they have been lost; no longer can you even pass a typing test at a temp agency. Word, Excel, Powerpoint? Haven't used them in so long that it would take me a while to get up to speed. Not exactly what employers want in a new hire, that's for sure.

Anyhow, enough of the ranting, just wanted to get back to the point of the story.


Underemployed in Cleveland

[question everything]

8. Thank you for sobering and true points

Indeed, as reports about decrease in unemployment came this morning, a caveat was added that about 30 million(!) workers are underemployed.

And, yes, the point of the story was that this seems to become the norm.

I hope that things will improve. For you and for everyone else. Soon.

[imdjh]

10. Not missing the point, discussing a different aspect of the issue.

Something that rarely gets discussed outside of Howard University perhaps, is that in the "good old days" of "good paying union jobs" there were three other tiers of labor that were not well paying, and that largely weren't not even paying minimum wage. Those would be agricultural labor, casual labor, and piece work. The people who worked in the lowest cast of labor propped up the relatively prosperous blue collar and middle class workers.

I'm not much of a graph maker, but I am willing to bet that as more and more workers got covered by winwage, workers comp, etc... you see the prices start to rise and downward pressure on unionized labor.

At some point, the union becomes artificial, it can no longer claim to represent labor, because too much labor is outside the union and competing, demanding, work. Look at law enforcement. They are slowly but surely trying to convert law enforcement to a completely degreed "profession" to narrow the pool of eligible workers. Why? Because the police unions can only claim legitimacy for so long before someone says, "Get rid of them. Too many qualified people want these jobs to put up with this shit." This is not anti-union talk on my part. I believe in organized labor, but it is not immune to other forces acting upon it. The bottom line with police is, that (thanks largely to the internet) the public is increasingly aware that it doesn't take Superman to do the job, that it's not the most dangerous job in city or suburb, and that there is no reason why it should pay a multiple of the average salary in the area it serves.

So what is this article really about? It's pretty clear that it's saying that our bulldozer guy shouldn't expect to get his $100K job back. But it's less than certain of what he should expect.

[Festivito]

11. Not missing it, just so used to it we move on to digressing.

Sorry if hits a little too close to home.

Good luck. We all need some.

[AnneD]

16. Let me tell you about my brother......

He is a master welder and boilermaker. He has always run his own business on the side and done well. He worked on the nuclear subs and was the foreman/ head welder. He always kept the thought in the back of his mind that mens lives depended on how well the seams he welded held under cubic square inches of pressure. He is a craftsman in the best sense of the word.

He charges a realistic fee and a construction manager in AZ. brought him down and promised him so many hours at my brother's price to do the welding on a new hwy bridges in Phoenix I think. Suddenly the work dried up and the manager canceled. My brother went to see the guy to ask why he was canceled (brother was their top producing welder). The manager had the balls to tell my brother he could hire 4 Mexicans and pay them $10 per hour. My brother, who frequently had to go back and redo the shoddy novice work to the manager that those welds they did wouldn't hold. The manager said' yeah, put I'll be long gone down the road by then. Bro was totally livid. Remember that the next time another bridge collapses during rush hour.

What does he do now? He has his own smoker unit and caters for rodeos pow wows, festivals, etc. He makes a ton of money. When he gets offers-he makes corrals and chutes for rodeos and busts broncs. He also makes furniture and art work out of farm equipment. There are some bridges he won't drive over!

[AdHocSolver]

13. In many years of work, I seldom saw an "overpaid" skilled worker.

The people who were overpaid were invariably the managers, who ranged from the merely incompetent to the downright stupid.

There were managers who had their own private agendas that did not coincide with the best interests of the companies.

Most of the managers at the companies I worked for cost the companies significant amounts of money through bad management, which was always covered up.

And, what the hell do you imagine that CEO's or presidents of companies do to warrant millions of dollars in salaries and bonuses?

Why did United Health pay its CEO $750,000,000 dollars over 10 years. Couldn't the company find a CEO who would have worked for only $100,000,000 or $75,000,000?

[Manifestor_of_Light]

12. Next time I buy a cup of coffee I'll tuck my Juris Doctor (framed) under my arm.

And see how much discount it gets me.

:sarcasm:

[AdHocSolver]

14. With the people in the examples making big bucks for several years, how come they don't have...

a lot of savings stashed away?

Even putting 10 or 15 percent of their income into CD's or buying shares of stock in conservatively run companies or mutual funds over the years that they were making the big bucks would give them enough funds to pay their bills without scrambling.

A lot of people are in financial trouble today because they assumed the party would go on forever.

[k8conant]

15. It's that way for lots of us

I had to retire from the feds 13 years ago due to a toxic workplace. After fighting them for 6 years, I got an annuity. I have over 20 years experience as a computer programmer (Assembler, COBOL, Java...).

I can't get any interviews for computer jobs...I'm too old. Believe me, I keep trying.

So now I am working as a grocery cashier--not only low-wage but only part-time. At least they hired me. I do my best, but I can't pay all my debts. I'm falling through all the cracks. The bank bailouts made all my credit interest rates double.

Underemployment is a huge problem, nationwide and for me personally.

[upi402]

17. The unemployment figures HAVE to be way off

I know soooo many under-employed and chronically unemployed these days.