Rising unemployment is taking its toll on older managers, who are more likely to be laid off and may stay that way longer. Middle-aged employees will find it harder to get a job, compared to younger workers with newer skills, experts say. But the tide may be beginning to change.
U.S. recessions since the oil crisis in the early 1970s each had their own special causes and victims, but they also had something in common: They were over relatively quickly.
The current downturn, however, is deeper and already longer than any since World War II. This spells trouble for one especially vulnerable group — managers in their 40s and early 50s.
They tend to be more expensive than their younger counterparts; they may lack some of the high-tech savvy needed to succeed in a more efficient workplace; and they face a downsized job market that will stay that way much longer than usual.
Even in a “normal” downturn, the job market is a “lagging indicator” (meaning it does not show improvement for several quarters after the start of a recovery). And the current recession is anything but normal.
According to Wharton finance and statistics professor Francis X. Diebold, co-director of the Wharton Financial Institutions Center, the employment picture is closely aligned with the depth of the recession.
If the recession really did bottom out in February or March, and if we stay on track and start growing at a positive rate by the end of this year — which is by no means certain — it could still be 2013 before we see some significant employment optimism.
A generation ago, says Wharton management professor Peter Cappelli, director of Wharton’s Center for Human Resources, “layoffs at this level were temporary. Not now.”
Even if an equivalent job were open at another company, that company will most likely not fill the position or will hire from within. In addition, Cappelli notes, in the 1990s, the economy experienced a “big wave of startups that would take on corporate people who had lost their jobs or bailed out of them. These days, we don’t see those smaller companies on the horizon.”