Help is still wanted

National | Layoff reports distort the economic picture; boomers ponder retirement; and food makers think young

Issue: "Summer Travel 2001," May 12, 2001

Playing off layoffs
Newspapers in recent weeks have added fuel to recession speculation by introducing the specter of widespread unemployment. But does media analysis match the facts? "If you landed in the U.S. from Mars and read the newspapers, you'd think nobody has a job," said D. J. Nordquist, a vice president at the Employment Policy Foundation (EPF), a conservative think tank. The New York Times last week led its business section with mass layoff announcements by 3M and Compaq. The Boston Globe touted major work force reductions by Honeywell and financial services firm T. Rowe Price. The Atlanta Journal-Constitution offered a gloomy summary: "U.S. unemployment (in March) rose to 4.3 percent as more than 86,000 jobs vanished, the biggest decline since 1991." But an EPF study of Bureau of Labor Statistics and Current Population Survey data puts recent large-scale layoff announcements in perspective:

  • Annually, job creation is still outpacing job elimination, and has since 1995.
  • Mass layoffs still account for 20 percent of U.S. unemployment-as they have for the past five years.
  • Public layoff announcements grew six times as fast as people were actually laid off. EPF attributes that last statistic to employer compliance with the WARN Act, a federal law requiring companies to give advance notice of large-scale personnel reductions. A widely quoted March report by the career services firm Challenger, Gray and Christmas stated that the number of employees affected by layoff announcements had increased 300 percent since March 2000. But workers who actually became unemployed, said Ms. Nordquist, rose by only 24 percent-a sign of slowdown, but not of full-fledged recession. Gold watches or golden years
    In just 10 years, most of the country's 80 million baby boomers-the largest segment of today's work force-will be at least 50 years old, while the earliest boomers will hit 65. According to Pennsylvania State University finance professor James Miles, many are asking, "When should I retire?" Many boomers' parents retired under company pension plans and knew at what age they could receive pension checks and gold watches. But boomers face a less certain dénouement to their primary earning years. Some, working under traditional pension plans that pay a lifetime annuity after retirement, wonder whether they should work past their earliest eligible retirement age. Others are building nest eggs with defined contribution plans like 401Ks. Financial specialists such as Mr. Miles say that "The employee under a traditional plan gives up a monthly pension payment for every month of work, making the net financial benefit to working much smaller.... People under defined contribution plans have a pot of money that they own," so they might as well keep working and put more money in. Some financial analyses, though, assume that money is the main reason to work and that people should stop doing what they are good at because they hit a certain age. For those who dreamed of being missionaries or having the time to do a thorough job as a church elder or deacon, retirement may be in order. But many who feel called to their work and have joy in performing it will keep going as long as they have the strength. All the young foods
    "Youth health" products will emerge as a hot new category in the retail foods market, according to a report published last month in Food Technology, a journal of the Institute of Food Technologists, a non-profit scientific society. Keying off increasing health consciousness and food-moderation concerns among adults, and the growing share of advertising directed at children, food manufacturers will increase healthful offerings targeted directly at kids. "Look for more kid-friendly main dishes and microwavable snacks," said Elizabeth Sloane, a California-based food- and pharmaceutical-industry business trend analyst. Some healthier snack choices for kids-like Gogurt (yogurt in a tube) and Kraft Easy Mac, a small portion of macaroni-and-cheese that kids can make themselves-already are finding their way into family grocery baskets. Though advertising doesn't mention it, such fare may serve the large market of latchkey kids who spend afternoons alone while both parents work. Still, healthier convenience foods can't hurt: One in four American kids is overweight, according to the Centers for Disease Control, and 27 million have high cholesterol.

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Lynn Vincent
Lynn Vincent

Lynn is a senior writer for WORLD Magazine and the best-selling author of 10 non-fiction books.


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