Employment Job News: 2012 Pay Cuts And Lower Ranking Jobs Expected For Most New Hires

By Donovan Jackson | Aug 27, 2012 12:02 PM EDT

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Finding a job in today's rough economy is very difficult. For those who have found work taking substantial financial pay cuts is becoming to the norm when returning to the work force.

Only 56 percent of Americans laid off from January 2009 through December 2011 had found jobs by the start of this year, the Labor Department said Friday. More than half of them took jobs with lower pay. One-third took pay cuts of 20 percent or more.

The figures would be even lower if people who could find only part-time jobs were included in the total.

The report provides an illustration of the job market's persistent weakness well after the Great Recession officially ended in June 2009. It also documents that while the economy has added nearly 3 million jobs since the recovery began, many pay less than those that were lost.

It has been proven that laid-off workers always have a harder time finding new jobs than do people who quit or those looking for new jobs while still working.

However, since the government began tracking such data in 1984, people who lost jobs in a recovery haven't had it as hard as they did in the one that began three years ago.

The government compiles data on laid-off workers every two years. The report covers only people who had worked at least three years in the same job before being laid off. In doing so, it focuses on those who had stable careers before they lost work.

According to information from the Associated Press, people like Andrew McMenemy, who used to make $80,000 a year as a computer systems administrator at a software firm. He was among the 80 percent of the firm laid off in March 2010.

Now, he makes $9.15 an hour, providing tech support for Apple. The job offers no benefits. He works from home in East Stroudsburg, Pa., where he lives with his father.

"I'm going to be 53; I have to live at home with my father," McMenemy said. "I made more when I worked in high school."

According to government reports About 6.1 million people with at least three years on the job were laid off in the three years ending in 2011.

That's down from 6.9 million in the previous report, which covered the 2007-2009 period. But it's still the second-highest total since 1984.

Though the proportion of laid-off workers finding jobs has improved since the 2007-2009 period, "by no means are they back to a normal level for a recovery," said Henry Farber, an economics professor at Princeton University.

Compared with most other recoveries, "this is really bad," said Dean Baker, an economist and co-director of the Center for Economic Policy Research, a liberal think tank.

An Associated Press analysis this month documented that by just about every measure, this economic recovery is the feeblest since the Great Depression. The weakness goes well beyond high unemployment.

According to another interview by the Associated Press, Kim Pinto, who lost her job in November 2009 as an executive assistant and office manager at a commercial interior design firm. Pinto, 50, who lives in Plymouth, Mass., was unemployed for nearly two years before landing a job as a sales person at a furniture store in July 2011.

Her new job pays roughly half the $52,000 she earned at her former job. The new one offers health insurance. But she can't afford the premium.
Pinto considered the sales job a "life raft" until she could find something better. She's still looking, and the competition is fierce. She applied for an administrative position at a local police station. There were 186 applicants, she was told.

"I've always worked a full-time job with benefits," Pinto said. "It's almost like that's a thing of the past. It really erodes your self-esteem."

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