TOPICS > Economy

The Unemployment Paradox: Why Job Seekers, Employers Aren’t Connecting

April 6, 2012 at 12:00 AM EDT
The U.S. job market appears to have a paradox: Many job seekers say they're desperate for work while many employers say they can't fill open positions. Are workers being too picky? Are employers being too cheap? Correspondent Paul Solman explores what's behind the disconnect as part of his Making Sen$e of financial news series.
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JEFFREY BROWN: And we continue our look at the job market with a seeming paradox that Judy and Greg Ip referred to, unemployed workers who say they’re desperate for a job, employers who say they can’t fill open positions with the workers they need.

NewsHour economics correspondent Paul Solman looks into the disconnect, part of his ongoing reporting Making Sense of financial news.

ANNIE CARTER, Carter Machine Co.: We have jobs in this county that go unfilled for years now.

PAUL SOLMAN: Annie Carter of Galion, Ohio, makes and repairs industrial cylinders, says she pays upwards of $20 an hour for work that didn’t seem that hard to master.

ANNIE CARTER: And we’re willing to hire anybody, train anybody to do anything. They just have to show us some — some work ethic, some motivation.

PAUL SOLMAN: Carter’s comments came as a real surprise when we visited her last March. Nationally, official unemployment was 9 percent; locally, 12.3 percent.

Our own more inclusive monthly reckoning of un- and under-employed Americans put it at nearly 18 percent. That provoked us to ask other employers we met last year, did they too have job openings they couldn’t fill? And, if so, why?

Drew Greenblatt runs Marlin Steel in Baltimore.

DREW GREENBLATT, Marlin Steel: We have actually had people tell us that they won’t accept a $16- and $18-an-hour job because they’re making $15 an hour on unemployment.

PAUL SOLMAN: Farmer Kim Haynes in northern Alabama.

KIM HAYNES, farmer: If the work’s too hard or too hot or too sweaty, they’re not going to do it.

PAUL SOLMAN: Bill Brittain, a tree specialist in rural Maryland.

BILL BRITTAIN, arborist: Yes, I would rather hire anyone who had the right attitude and was trainable and dependable. But a lot of those people just don’t seem to come along much anymore.

It’s putting all us out of business.

PAUL SOLMAN: The most caustic was Bobby Joslin, a sign maker in Nashville, Tenn.

BOBBY JOSLIN, Joslin and Sons Signs: They cannot fill out an application from the top to the bottom without misspelling half the words. It’s pitiful.

PAUL SOLMAN: Employers like Joslin blamed, first and foremost, the government for providing and extending unemployment insurance, allegedly allowing workers to refuse jobs they don’t like.

That was Annie Carter’s main gripe last year.

ANNIE CARTER: We’ve offered people jobs, and they say, no, thank you. I’m going to wait until my unemployment runs out.

PAUL SOLMAN: How many of you have maxed out on unemployment insurance benefits?

Of course, to get the benefits, you have to be looking for a job. So at The WorkPlace, a Connecticut nonprofit that helps the long-term unemployed get back into the job market, we recently asked workers who had used up all their benefits:

Any of you ever applied for a job just to stay on unemployment insurance?

MAN: No.

UNIDENTIFIED FEMALE: No.

MAN: No.

MAN: No way.

MAN: Hell no.

PAUL SOLMAN: Hell no?

MAN: Hell no!

(LAUGHTER)

MAN: Did you hear it that time?

(LAUGHTER)

MAN: Hell no. We didn’t do that.

WOMAN: We want to work.

MAN: We didn’t volunteer to quit our jobs. We were volunteered.

MAN: I was at my job for 28 years.

LORRAINE DOWDY, unemployed: And I would still be at my company, because I loved where I was working and I loved my job.

Where do people get this idea from that everyone is a crook?

PAUL SOLMAN: Not a crook. This is just. . .

LORRAINE DOWDY: You’re taking advantage — taking advantage of the system?

PAUL SOLMAN: Lorraine Dowdy lost her job as a commodities analyst in 2008.

LORRAINE DOWDY: I have applied for so many jobs, to the point where it just got very, very depressing. There was no response whatsoever.

PAUL SOLMAN: So, how are you surviving?

LORRAINE DOWDY: It has been tough. I have had to move out of my apartment. I have run totally out of resources. I’m actually homeless right now and living with friends.

PAUL SOLMAN: The stories in this room did square with what we have been hearing the last three years from workers.

Robert Sorrells lost his manufacturing job in 2009.

ROBERT SORRELLS, unemployed: I went back to college and got a — for computers, you know, Word, Excel and all that stuff, and got a B-plus average in that, and still haven’t found a job.

PAUL SOLMAN: Marge Welch spent 38 years in mortgage banking.

MARGE WELCH, unemployed: You apply for the little jobs because you’re overqualified. You don’t hear anything. And then you go and look and see what they hire, and it’s like, how did they get hired and I didn’t?

PAUL SOLMAN: Sharon Moore worked in software customer support.

What’s the lowliest job you have applied for?

SHARON MOORE, unemployed: I applied in a warehouse. And they told me, whatever they needed me to do, they would expect me to do it, and I would say — I said fine.

PAUL SOLMAN: And how much was that an hour?

SHARON MOORE: They didn’t tell me how much it was an hour.

PAUL SOLMAN: And they didn’t hire you either.

SHARON MOORE: And they didn’t hire me.

PAUL SOLMAN: Would you work at a factory in Ohio?

SHARON MOORE: I have my grandmother and my parents are retired, so I am the only daughter, and they rely on me a lot. So I wouldn’t want to move and leave them.

PAUL SOLMAN: In fact, even though some in this group said they were desperate enough to take a job at $10 an hour, half of what Annie Carter said she was paying, the idea of migrating to an Ohio region that’s been hemorrhaging factory jobs for decades seemed downright ludicrous to most everyone.

As former cable company employee Earl Schoolfield put it:

EARL SCHOOLFIELD, unemployed: Why relocate across the country when I might have the same risk of getting laid off out there, and then be away from all of my contacts, friends and family?

PAUL SOLMAN: So what about young local people? Perhaps they could fill the jobs in places like Annie Carter’s factory?

Would any of you take a job in a machine shop around here?

GIRL: No, I wouldn’t.

PAUL SOLMAN: Why not?

GIRL: Because my parents have worked in a machine shop, and I see how much struggle they go through because sometimes — my dad just last year got laid off.

PAUL SOLMAN: Bethany, would you?

GIRL: I would never choose factory as a long-term career for myself.

PAUL SOLMAN: Why not?

GIRL: It’s a very insecure business.

PAUL SOLMAN: Small wonder the young people who do come to Annie Carter’s factory are the town’s less motivated.

ANNIE CARTER: One of the biggest issues that we have currently is people will come to an interview looking sloppy, having — being dirty, those kinds of things.

PAUL SOLMAN: They didn’t really want a factory job, Carter said. And that’s another common employer complaint we have kept hearing, that American workers have become entitled. Many just won’t take hard jobs at modest pay.

Last June, we did a story at WeRecycle, an electronics recycling firm in Mount Vernon, N.Y., that hires ex-cons who’ve graduated from a college-behind-bars program, will work any hours, do anything.

By contrast, says one of them, Anthony Cardenales:

ANTHONY CARDENALES, WeRecycle: I have a lot of family and friends who are offered positions that they think do not pay enough for them.

PAUL SOLMAN: And they turn them down.

ANTHONY CARDENALES: And they turn them down.

PAUL SOLMAN: And you say to them?

ANTHONY CARDENALES: I say to them, why are you not washing dishes here for $7.25 an hour? And they say, I’m not doing that. And I’m saying, okay, so, on Friday, you’re going to be broke, like you are today, as opposed to, if you were working here, you will have $100 or $200 in your pocket that’s yours, that you earned. And then you’re still looking for better employment, but you’re employed.

PAUL SOLMAN: Cardenales’ first job out of prison was putting up cable wire for $200 a week, which barely paid his commuting costs.

Two-and-a-half years later, he’s a manager at WeRecycle, earning close to six figures.

So we put the question to his boss, Virgil Fisher.

Is the American work force, for the most part or to some significant extent, entitled?

VIRGIL FISHER, WeRecycle: I would think so. We have gotten used to a certain lifestyle and a certain concept of what our job should look like.

PAUL SOLMAN: We heard that repeatedly. Significantly, though, many employers, like Maryland contractor Jonathan Herman, put it comparatively.

JONATHAN HERMAN, contractor: Nowadays, there’s an opportunity to hire people of Hispanic descent, and it’s much — they’re much harder workers.

PAUL SOLMAN: Same refrain in Alabama last October from farmers upset by a new state law that chased undocumented workers from the fields.

KIM HAYNES: They’re here on time. They work all day. They work extra hours. They work in the heat. They work in the cold.

PAUL SOLMAN: And, of course, they come from a country, Mexico, where the median standard of living is something like one-sixth what it is here.

Now, given their ages, these Connecticut folks might not last long in the sweltering fields of Alabama. But to the charge that many of the unemployed just won’t work hard enough, folks like 59-year-old Earl Schoolfield said, nonsense.

EARL SCHOOLFIELD: This past November, I had three part-time jobs during the holidays, the Christmas holidays.

PAUL SOLMAN: What were you doing?

EARL SCHOOLFIELD: With the FedEx, it was lifting and loading packages onto — from the conveyor belt onto the truck.

PAUL SOLMAN: At a fast pace.

EARL SCHOOLFIELD: At a very fast pace, and going into work at 3:00 a.m., and then getting off that job at, say, 7:00, and then going into an 8:00-to-5:00 job.

PAUL SOLMAN: Really?

EARL SCHOOLFIELD: Yes, and then leaving the gas company and going to work at telemarketing over the phone from 6:00 to 9:00.

PAUL SOLMAN: Okay, what’s going on? Twenty-seven million un- or under-employed Americans, yet jobs that go begging.

Union economist Thea Lee has a simple answer.

THEA LEE, deputy Chief of Staff, AFL-CIO: You can interview workers and you can interview employers. And the employers may tell you they can’t find the kind of workers they want at a certain wage. But there’s at least four job-seekers for every job opening.

And American employers, I think, have sort of convinced themselves that they can offer a low wage, and then sit back and complain that there aren’t workers out there willing to work for those wages. Pay a higher wage, you will attract all sorts of folks.

PAUL SOLMAN: Joe Carbone, president of the WorkPlace, agrees.

JOE CARBONE, president, The WorkPlace: It’s a buyers’ market. This is a market made for business. They can get more for less. And I think there’s more of that going on than there is anything else.

PAUL SOLMAN: So, jobs or no jobs? In a complex economy like ours, there’s no simple answer.

JUDY WOODRUFF: You can check out Paul’s own measure of unemployment on our Making Sense page. That’s at NewsHour.PBS.org.