Saturday, April 4, 2009
Not even the low-paying jobs are offering full-time; looking for work is becoming a disaster; 20,000 restaurants could close over three years
The Wall Street Journal reports that traditional low-paying jobs in restaurants and retail outlets are quickly disappearing, and no one is offering full-time work.
This tragic trend is a double-edged sword.
First, people with much more experience and education are willing to take those jobs, which aren't really going to help them meet their needs.
Second, these people will push out less educated folks from these jobs, who will have no where to go from employment.
Even the restaurant jobs some people get now will not last. CNBC reports that 20,000 restaurants will close over the next several years due to massive overbuilding:
Since 1990, the number of restaurants and bars has grown to 537,000 from 361,000, a 49 percent increase, according to the National Restaurant Association. Population in the United States grew 23 percent in that period.
Amid the seeming prosperity of a credit-fueled era, people got in the habit of eating more and more of their meals out. The association’s statistics show that 48 cents of every food dollar is now spent at restaurants, compared with 40.5 cents per dollar in 1985.
In a recent note to investors, John Glass, an analyst for JPMorgan, said the casual dining industry — midrange restaurants like Applebee’s — needed to shutter about 1,200 of its roughly 18,000 locations to regain financial health.
“The chain casual dining industry has been overbuilt since 2005,” Mr. Glass wrote, noting that was the last year the industry posted positive numbers for customer traffic. “It may take two or more years to reach equilibrium.”
Others said the pruning of restaurants would extend beyond casual dining to all types of restaurants. Bob Goldin, executive vice president at Technomic, a Chicago consultancy for the restaurant industry, predicted that more than 20,000 restaurants would close over the next three years.
“I think 20,000 is a minimum,” he said. “We probably need more than that. There are a lot of marginal players out there.”
I give a lot of credit to the WSJ for following this story from the job seeker's perspective. Someone needs to, because it is the source of all despair that is growing in this nation despite bank bailouts and Bear market rallies.
This is real life, and why our recession is actually a depression not only economically but emotionally.
The WSJ reports:
LEWISTOWN, Pa. -- The growing ranks of unemployed Americans are turning to the traditional fallbacks -- retail, restaurants, customer service -- to ride out a rough economy. The bad news is job openings there are growing scarce, too.
Widespread "trading down" is sparking a fight for low-wage jobs that employers once struggled to fill. Mark Hall, 24 years old, of Alexandria, Pa., lost his $12-an-hour gig as a videographer when his employer folded and is now looking for anything to make ends meet.
"Finding a regular job, not even in my field, is very challenging," said Mr. Hall. "Even working for Lowe's, I'd settle for that, and I have a four-year degree."
Last week, Mr. Hall joined more than 500 people at a job fair in Lewistown, a fading manufacturing hub. Hardware and appliance retailer Lowe's was among 30 employers recruiting, down from 46 last year, and looking for mostly part-time and seasonal employees.
Despite what objectives they may have put atop their resumes, when asked to describe the work they really wanted, the job seekers largely had the same goal: "I'll take anything right now."
In many cases, that desperation means that even educated workers must trade down to jobs below their potential and with lower pay. That results in painful, long-term effects, from hurting their own career advancement to displacing those with less education or experience.