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The Trauma of Long Term Unemployment

Here in the Land of Limbaugh, what's a laid-off boomer to do?

| Tue Oct. 5, 2010 12:16 PM EDT

"I'm Not Competing With Some College Kid"

In the early evening, Rembold and I holed up in his office, a small room off the main hallway with a computer, two desks, and countless framed photos. Rembold clicked open a folder on his Internet browser labeled "Careers" and walked me through his daily online job-hunting routine. He checks half-a-dozen job boards regularly, though openings tend to pay only in the $8- to $10-an-hour range. He rejects most of those out of hand.

"Wouldn't that be better than no job at all?" I ask.

Rembold gnaws on the question. "I can't afford my home at $8 or $10 an hour," he finally replies. Right now, he's getting by on unemployment checks, a small inheritance from his mother that's rapidly dwindling, and loans from family members. Still, he'd rather keep trolling the job boards in the hopes of finding something offering a living wage. "I've got a mortgage to pay, for Christ's sake," he told me. The few openings he sees with good pay, however, involve odd hours, dusk-to-dawn shifts that would mean he'd almost never see Terri, whose schedule at an aluminum company in Elkhart is early morning to mid-afternoon.

And then, under the dollar signs lurks something else: self-respect. Unlike his father, Rembold never went to college, and doesn't consider himself too good for service-sector jobs. But he visibly agonizes over the fact that, as a 56-year-old man with decades of experience, he's competing with people half his age for low-wage jobs. After all, as a machine operator fresh out of high school at White Farm Equipment, he earned $8.64 an hour. That was 1976. Adjusted for inflation, that's equivalent to $42.42 today. No wonder the man's reluctant to flip burgers or trim hedges for $9 an hour.

His friends have suggested selling his condo and moving somewhere smaller and cheaper, maybe renting for a while, but that's the last thing he wants. It's that self-respect again. He's already sold off one motorcycle and various musical instruments, and he and Terri now skip the big vacations that were part of their past life. Which isn't to say that Rembold currently lives like a monk. He still has the big screen in the basement, the DVD collection, the video-game systems for when the grandkids visit, a life's worth of possessions from decades of earning good money. "Why should you have to give up your home?" he wanted to know. "It's so unbelievable to me that I don't even want to think about it. I'm in denial."

A Lost Generation?

What's to be done for people like Rick Rembold? As in most economic debates, the answer to this question divides economists and policymakers. On the left are those who lobby for more aid to jobless Americans, including another extension of unemployment insurance beyond the present cut-off date of 99 weeks. (In normal times, laid-off workers once got 26 weeks of unemployment insurance.) Some Democrats in the Senate had hoped to extend unemployment insurance by another 20 weeks up to 119 weeks, an effort spearheaded by Senator Debbie Stabenow (D-Mich.) that ultimately failed last week in the face of Republican opposition. That same camp supports a one-time "reemployment bonus," a lump-sum payment that unemployed workers would receive to reward them for finding a new job and leaving the unemployment rolls.

Another idea gaining traction in policy circles is "wage insurance," in which the government would supplement the income of workers rehired at lower-paying jobs. Consider Rembold who, in his prime, earned $25 an hour. He says can't live on a $10-an-hour job, but if that were to become $12 or $15 an hour, thanks to a government subsidy, he'd be much more interested.

More conservative voices believe cutting jobless benefits—a bitter pill, to be sure—will force people back into the workforce. The Rembolds of America will then scramble harder and take those low-wage jobs faster. Of course, those who can't find work at all will be left adrift with no safety net. What's more, the cost of such cuts to taxpayers might actually prove higher, economists note, because without those benefits the jobless might instead apply for disability or other support programs and give up the search altogether.

Ideally, of course, employers and governments should avoid widespread layoffs altogether. One option sometimes suggested would be a "work-share" program. Imagine a factory of 100 workers with a boss looking to cut costs. Instead of laying off 25 workers, he would reduce all of his workers' hours by 25 percent. The government would then step in to fill the earnings gap. Think of it as the equivalent of collecting unemployment before you're laid off, a preventive measure to avoid the trauma—to income, health, family—of job loss.

None of this is likely to happen soon, which is little consolation for the long-term unemployed like Rembold. Unfortunately, there are few proven solutions to their situation. Job retraining programs for unemployed workers are all the rage these days, touted by Education Secretary Arne Duncan, Treasury Secretary Tim Geithner, and President Obama as a transition to a new line of work. But a 2008 study commissioned by the Labor Department found minimal to no gains for 160,000 workers who went through retraining, concluding that the "ultimate gains from participation are small or nonexistent."

In the end, facing an economy that may never again generate in such quantity the sorts of "middle class" jobs Rembold was used to, what we may be seeing is the creation of a graying class of permanently unemployed (or underemployed) Americans, a genuine lost generation who will never recover from the recession of 2008. As Mike Konczal and Arjun Jayadev of the Roosevelt Institute, a left-leaning think tank, recently wrote, unemployed workers today are more likely to abandon the workforce than find work—something never before seen in four decades' worth of labor data. "These workers need targeted intervention," they concluded, "before they become completely lost to the normal labor market."

"All I Need Is One Chance"

I first noticed Rembold's tic on Sunday, my last day in Indiana. Out of nowhere, without provocation, he'd suddenly say things like "Man, I just need a job," or "All I need is a chance," or "I wanna work, make stuff with my hands." He'd been filling the lulls in our conversations with these little outbursts, symptoms, I assumed, of the worry and anxiety that never left his side. Which is why I called a few weeks after my visit, hoping for good news.

And there was, after a fashion. Angie, his daughter, had ended up sticking with Check$mart, much to his relief. But for him, the leads were sparser than ever. "There's this neighbor here," he said, "her son's a shift manager at the Walmart, so he's gonna see what they might have." He also mentioned an electronic wire and cable manufacturer with openings in Bremen, a half-hour south. He'd recently applied there for the third time this year. This time around, he went on, he planned to march in and demand the interview he'd never gotten. "I mean, what's it take to get in to see someone there?" he asked me.

Rembold doesn't have time on his side. Unlike the now-famous "99ers," the folks who received nearly two years' worth of unemployment benefits, his will expire sometime this winter, short of the 99-week mark. He's not sure what he'll do by then if he can't find work. Maybe take one of those $8-an-hour jobs after all. For now, though, he's just checking the job boards each morning, shipping off resumes and cover letters, firing up the Suzuki, chasing leads.

I asked if he still had any hope left that something good would happen. "I don't know," he replied. " 'Course if ya don't go, ya don't know."

Andy Kroll is a reporter in the D.C. bureau of Mother Jones magazine and an associate editor at TomDispatch. He's always looking for new stories in this economic downturn: You can email him at akroll (at) motherjones (dot) com. To catch him discussing the jobs crisis on Timothy MacBain's latest TomCast audio interview, click here or, to download it to your iPod, here. This story was written with research support from the Investigative Fund at the Nation Institute.

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