Archive for June, 2008

From Editor and Publisher:

“SANTA ANA An Indian company will take over copyediting duties for some stories published in The Orange County Register and will handle page layout for a community newspaper at the company that owns the Pulitzer Prize-winning daily, the newspaper confirmed Tuesday.

Orange County Register Communications Inc. will begin a one-month trial with Mindworks Global Media at the end of June, said John Fabris, a deputy editor at the Register.

Mindworks’ Web site says the company is based outside New Delhi and describes its work as providing “high-quality editorial and design services to global media firms … using top-end journalistic and design talent in India.” …”

Background

United Professionals grew out of Barbara Ehrenreich’s 2006 book, Bait and Switch: the (Futile) Pursuit of the American Dream, on white-collar unemployment.  On her book tour, Barbara met legions of people who had personally experienced what she had written about. They kept asking, “What can be done to protect the white-collar middle class from being eroded by downsizing and outsourcing?”

That question gave rise to United Professionals, an advocacy group designed to protect and preserve the American middle class and the opportunities it represents for millions of people who are currently in poverty.  We asked UP members which kinds of activities were most important to them, and a majority responded that advocacy should be UP’s main focus.

Like poverty in general, white collar unemployment and downward mobility get only intermittent attention from the media, but the problem is chronic and corrosive to the middle class.

• In this decade, white collar unemployment accounts for 20 percent of unemployment in general, a much higher proportion than in the past.

• On average, before the current economic downturn, it took a laid-off white collar person six months to find a new job, and the new job typically paid 17 percent less than the old one.

• Many of those churned out from white collar jobs do not show up for long in the unemployment statistics because they take lower-paying, nonprofessional jobs - for example, as waitstaff, retail clerks or janitors. According to a 2006 study undertaken by the Economic Policy Institute and sponsored by United Professionals, 17 percent of jobs that do not require a college degree are currently filled by people with college degrees.

• Right now, massive lay-offs in finance, real estate and other sectors are creating a critical situation for increasing numbers of white-collar professionals. 240,000 Americans lost their jobs in the first quarter of this year, and the worldwide finance sector alone is planning to lay off 65,000 in 2008.

On the UP website (www.unitedprofessionals.org) space is provided for people to tell their stories.  These examples give a very human voice to the dilemma that our members — and millions of Americans - are experiencing:

• “Frustrated, harassed, devalued, demoralized and ready for a change in how employees (professional or not) are treated.”
• “The company I work for now has hired me as a consultant to help them get through the tough times so that they can outsource parts of their operations areas to India. And people ask me, why don’t I find a permanent job? I tell them there are no more permanent jobs.”
• “With 30 years’ experience, I’m now being paid entry-level wages, and am forced to perform the equivalent of two full-time positions.”
• “My husband has heart problems and our COBRA (for which we pay $1000.00/month) is coming to an end.”
• “I am a laid-off 54 year old divorcee with a law degree and no job.”
• “I am a temp legal worker, which is to say an indentured servant.”

These stories, and myriad others we hear about, tell us that many professionals are in desperate straits due to job loss and consequent downward mobility. Some of these are middle-aged people judged “too old” for re-employment; others are young college graduates who fail to gain traction in the workforce. The one constant is the anguish felt by middle-class professionals as they find that the American Dream is unattainable - despite their education and hard work.

Issues

• The current unemployment system does not offer adequate counseling or retraining grants so that disenfranchised members of America’s home-grown brain-trust can continue to contribute their skills and dedicated work ethic in any valuable way.

• Since one’s job is the primary portal through which the American system of health care is accessed, hard work and a good education do not guarantee protection for one’s family in times of medical need.

• Forty-eight million Americans are without healthcare coverage.

• The fastest rising forms of coverage consist of inexpensive plans that offer little or no protection against catastrophic illness or support for maintaining wellness.

• The workforce continues to adjust to corporate policies in the face of globalization that cause many millions of college-educated workers to be unemployed, underemployed and anxiously employed.

• Traditional safety nets continue to erode including company sponsored training, pensions and retiree medical care.

 United Professionals Mission Statement
Our mission is to protect and preserve the American middle class, now under attack from so many directions, from downsizing and outsourcing to the steady erosion of health and pension benefits. We believe that education, skills and experience should be rewarded with appropriate jobs, livable incomes, benefits and social supports.

Objectives

• Develop a campaign on portable, affordable healthcare. This campaign should be seen as a 5-year effort.
• Establish a strong advocacy base by growing the membership to 500,000 over the next six years.
• Basic infrastructure within 18 months, including a national director, administrative assistant, and a cyberorganizer (a person who runs the website but does much more in terms of organizing people on line).
• A significant cyber presence defined by:
  • Hiring a cyberorganizer
  • Expanding the website’s blogs
  • Setting up sectoral chats
  • Expanding cyber advocacy capability
  • Ongoing education and leadership on issues of the day
• Build alliances with organizations such as the AFL-CIO’s Department of Professional Employees and its affiliates including:
  • Obtaining financial contributions from 5 unions for the next two years
  • Working with the DPE on a UP Annual Policy and Organizing Conference (see below)
  • Combining efforts on healthcare reform with existing healthcare reform groups
• Establish UP working groups on particular subjects, such as personal debt and unemployment benefits
• Hold an annual UP Policy and Organizing Conference
  • Hold in different cities with the first one in DC in 2009
  • Gain co-sponsors from the union movement and other allied groups
  • Combine education, training and networking
  • Seek publisher for major papers out of select workshops and publish other papers as appropriate
• Seek funding for a 2009 unemployment organizing project entitled:  “Kicked to the Curb.”
  • Work for severance pay for RIFed workers; jobs; income supplements for unemployed; extension on unemployment benefits; job training.
  • Fight for a version of the Trade Assistance Act (which provides funding and training for workers displaced due to foreign competition) for white collar workers who lose their jobs due to employer’s bad investments and/or corrupt practices.  Would also provide financial support for those who have lost their 401(k)s and/or pensions for the same reason, e.g., the Enron workers.
• The Board:
• Meets twice a year in person
• Establishes an executive committee that meets via conference call at least twice a month
• Aims, within two years, to have developed a structure whereby most board seats are elected by the membership. [note:  need to explore whether this would be at large or via chapters or both]
• Budget:
• $125,000 for national director (salary plus benefits)
• $60,000 for administrative assistant (salary plus benefits)
• $60,000 for cyberorganizer (salary plus benefits)
• Seek donated space for an office, or there might need to be a virtual office plus a p.o. box
• Air transportation, car rental, hotel, food for national director while on the road:   At least $15,000
• Phone, fax, etc.
• Subcommittees:
• Cyberorganizing committee (works with the cyberorganizer; writes; designs)
• Media:  need to develop a comprehensive media strategy.  In the initial stages seek donated assistance from media consultants.
• Finance/fundraising:  a priority committee to seek means of raising funds including but not limited to foundations, individual donors, labor unions and other organizations as appropriate.
• Policy, including healthcare, pensions.  Such subcommittees could initially do research and writing of policy briefs, but they could also lay the foundation for any campaigns.
• Policy and Organizing Conference planning committee:  a permanent committee though membership would inevitably rotate.

Despite the unbridled (okay, barely bridled) glee on Wall Street at the Dow’s climb above 13000, the tide that’s raising some boats is swamping others and running a lot of dinghies aground. Let’s follow the money to a few ports of call that UP members care about.

Apparently, we’re not the only ones concerned about the health of our finances as well as the health of our bodies. MSNBC’s Gut Check America reader poll on the issues Americans care most about, with 6,000+ participants by midnight ET on June 7, found that the top two of the five finalists are UP issues – personal economy and health insurance. The other 3 finalists are: illegal immigration, the war in Iraq, and education (in that order).

Last week’s business news in several journals contained a sprinkling of articles on the money-business’s exploitation of the working poor. Froma Harrop’s article “The Vile Business of Preying on the Poor” in the Providence Journal neatly summarized a litany of horror stories of loan sharks and con artists plundering the wide, but shallow, pool of low-income workers. We have big financial “services” (yes, my tongue is in my cheek) companies entering the payday-lending market with annual interest rates of 120 percent. And subprime mortgage lenders, who charge high interest rates and fat additional fees to people who can’t get better interest rates, are now foreclosing on all the mortgages they blithely allowed the truly not-qualified to “qualify” for during the real estate boom based on the predicted appreciation of the houses’ values. Oopsie!

Well, let’s take the jaundiced view – a lot of those “not ready for prime rates” homeowners were speculators themselves, hoping to flip a few houses with a few cosmetic improvements in a rising market. They’re losing investments, not the roof over their family’s heads. But many others were the working poor, hoping to become homeowners instead of renters because banks would finally lend them more money than their incomes justified. When the real estate bubble burst, so did their dreams.

Those scenarios, we can probably understand. But wait … there’s a new twist. Harrop presents the intriguing fact that “Subprime mortgages … are packaged into securities. Investors currently hold more than $1 billion in subprime loans from 22 ZIP codes in Detroit alone, according to The Wall Street Journal.” Packaged into securities? Like the hot and sour soup is “packaged into” my Szechuan chicken and fried rice lunch at the Chinese fast food place? Nah! Couldn’t be! But yes, it is.

Quoth Wikipedia in an entry titled “SubPrime Meltdown,” Federal Reserve Chairman Ben Bernanke discussed the increase in home ownership coinciding with the expansion of secondary markets in which mortgage loans were packaged and sold to investors. Among Chairman Bernanke’s observations on the “background and run-up to the present crisis in subprime lending,” he opined upon the “adjustments government regulators needed to make to minimize the scope and severity of subprime mortgage problems.”

Apparently, not much. Wikipedia quotes Bernanke: “ ‘We at the Federal Reserve will do all that we can to prevent fraud and abusive lending and to ensure that lenders employ sound underwriting practices and make effective disclosures to consumers.’ But, according to Bernanke, the kinds of innovations in credit markets represented by exotic subprime loan products have had a positive effect, opening up home-buying opportunities for millions of Americans. During the years when subprime products came into wider use, home ownership has expended from about 65 percent of all Americans in 1995 to 69 percent today, he said.”

Well, all right then, that makes me feel better. A rise in home ownership of four percent over twelve years, compared to … what exactly is the current rate of foreclosures?

As of November 8, 2006, RISMedia, a real estate information site, reported that “Foreclosure marks 39 percent increase compared to last year.” Looking forward to 2007, the report continued, “Industry forecasters recently estimated that more than $200 billion worth of adjustable rate mortgages will ‘reset’ at higher rates in 2006 and over $1 trillion will reset in 2007. This situation, compounded by the expected slowing of the economy and the housing market, which according the National Association of Realtors includes a growing inventory of unsold homes, may edge more homeowners into the foreclosure process.”

But Chairman Bernanke remains sanguine, even half-way through 2007: “ ‘The effect of the troubles in the subprime sector on the broader housing market will likely be limited, and we do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system,’ he said. On June 5, 2007, Bernanke repeated his belief that troubles in the subprime mortgage market are ‘unlikely to seriously spill over to the broader economy or the financial system.’ ”

Why shouldn’t we rely on the happy-days predictions of this economic expert? For one thing, common sense tells me that people who are losing their homes (even if they’re house-flipping speculators losing their investment capital) are not going to be contributing very robustly to the economy overall. They’ll be too worried to work at optimum productivity, and they’re sure not going to be paying real estate taxes that contribute to the local school districts so they can produce educated citizens instead of illiterate thugs preparing to matriculate at Penitentiary U. For another, what about all those investors who have had the hot-and-sour subprime mortgage soup packaged into their securities investments? Doesn’t sound like very secure securities to me. (Have you checked your investment bundles, lately?)

Then there’s the worrying attack of conscience that Business Week produced in a veritable True Confessions series on low-end lending – “The Poverty Business” report, “Getting Rich off the Poor,” “Perspectives on Profiting off the Poor,” and “Economics of the Poverty Business.”

As more of us who were the working middle-class become the working poor in this stupid economy, we need to rely on our educations for our survival. We may have to tighten our belts, lower our expectations (at least temporarily), retrench, get creative about what kinds of work to apply our brains to, and all those things that delay gratification. Fine! We can do that. Let’s just not get trapped by our own impatience. Let’s not mortgage our lives. It’s the economy, stupid. Let’s not be stupid about the economy.

What if losing your job wasn’t a big deal? What if you’re downsized, RIFed, outsourced, laid off, or just plain fired – and you don’t panic, feel like a total loser, get depressed, or go into debt? What if there was no negative stigma involved in losing your job – in fact, what if the idea of “losing” a job became quaintly outmoded, and the idea of making a positive change took its place?

What if you had the freedom to explore what you want to do next, without financial devastation? What if you’re sick of being a lawyer and want to be an organic farmer? What if you’re a bricklayer and want to be a teacher? What if you never had to feel trapped in a job you didn’t like, held hostage by salary and benefits?  And what if this were possible?

It can be possible. It’s a concept called “Transition Rights.” Workers would pay into their transition fund much like they now pay into a 401k, with dollars matched by the employer, local or federal government, and possibly also by charitable foundations. So when employees are laid off or just want to change jobs, their transition fund is available.

The idea of transition rights is based in part on the ideas of Amartya Sen, Nobel prize-winning economist and philosopher; Gunther Schmid, a German economist; and Karen Orren, author of “Belated Feudalism.” The basic premise is that workers – whatever color their collars are – should not be treated like serfs, earning their bread at the mercy of the local landlord. If we as a society truly embrace individual freedom and dignity, we must begin to reshape our concept of the employee-employer relationship, which is still referred to in U.S. law as “master-servant.” 

 In exotic northeast Indiana, where all segments of the labor market are far too experienced in unemployment and transtions, the Workers’ Project is connecting the ideas of Sen, Schmid and Orren to working reality. There is wide recognition that the economy has been broken on the heads of workers but will be fixed by their ingenuity and initiative. Employment attorney Alan VerPlanck along with UP board member and Northeast Indiana Central Labor Council president Tom Lewandowski believe the best hope for implementation of transition benefits programs may be at the local labor market level.       While transition rights are currently only at a developmental stage, Lifelong Learning Accounts (LiLAs) are a similar concept already in effect in several states and are embraced by dozens of companies. LiLAs are employer-matched, portable, employee-owned accounts used to finance education and training. Senate Bill S 26 proposes the establishment of a federal demonstration program for such accounts. The Council for Adult and Experiential Learning (CAEL) strongly endorses LiLAs. 

The average American will change jobs 10 times between ages 18 and 40, according to the Bureau of Labor Statistics. In the United States, layoffs are easily accomplished (when compared with France, Italy, Germany, and elsewhere where national laws limit lay-off activity) and are a source of economic strength that greatly benefit American-based companies.  Those proposing transition rights assert that it would make economic sense to help workers accept – and even embrace — the transitions that are now a normal part of our work-life.  A more aggressive development of transition rights would be a positive step in that direction.

As VerPlanck recently wrote in his blog on the Working Indiana website, “The clear advantage of refocusing the life-course and work-life balance is a promotion of individual liberty and freedom of choice.  One of the ironies of American life is its often blind belief in and adherence to marketplace norms—everywhere but in the labor market.  Perhaps by investing in transition rights we can … provide enrichment to human capital.”  

As we find ourselves not-so-valued by Corporate America, with our jobs outsourced to who knows where, the vacuum left by the departure of other-created busy-ness may be filled with a rush of creativity. If your energy rush includes the thought that, hey, maybe companies will want to outsource jobs I can do to me if I become a freelance contractor or consultant, read on. The fact is, even if you become re-employed full-time, you now know that for the rest of your career, it’s your career - captain of your ship, owner of your brand, salesperson of your skills. Any way you work it, you’re an entrepreneur.

Here are some strategies I’ve found that work. Focus on what you know. Outsource everything else. Repeat these two sentences until they become one with your breath. Form a clear and detailed picture in your mind of yourself doing what you want to do successfully - not just a verbal description of it; see it running like a film clip. Seriously. Entrepreneurs need to become adept at the arts of auto-suggestion and envisioning your goal so clearly your muscles go through the micro-motions of it, the same as top-level athletes do.

Especially in the early months of freelancing or entrepreneurship, it’s easy to get distracted by details of matters in which you are not an expert. Structure all your support staff-employees, contractors, advisors-to free you to do what only you can do. Usually that means two things. One, you’re the COO. You do all the production work or you closely direct the production staff. This is true whether the “product” is a physical product or a service. Two, in the beginning you’re the point-person for marketing and sales. In the early days (or years) of your independent contract work, you are establishing your brand. Especially if your product is a service, you are the brand. You have to establish trust in your “brand promise.” Later, the testimonies of satisfied clients can support that promise, and your sales and marketing minions can cite those “referenceable customers,” but in the beginning, you’re it.

If you thought reporting to your corporate boss was hard work, being your own boss is far more demanding in order to achieve success. You are now the boss, the producer, the workerbee, the gopher, the administrative assistant, and every other role you can imagine. Automation can help. Others who offer freelance services can help with bookkeeping, office administration, legal issues, marketing, sales and other functions that are not your primary expertise.

Join a local Chamber of Commerce, or just visit the list of members on their website, to find a trustworthy small-business attorney, accountant, and banker. Those are three resources you want to look in the eye and shake their hands, interview several of each, and then trust your gut on the final selection.

Much marketing and office admin work can be outsourced over the Web if you can’t find a reliable local provider. These are commodity services; they are what they are. Your office phone can actually be answered, and your mail (both e- and snail) can be sent, from anywhere. You want to cut the best deal for value of the service delivered for the fee you pay, the same way you shop for the best value in sugar, flour and milk. In the first few months of any such service that represents you to your customers/clients, monitor the provider’s performance closely. Call clients yourself and ask how they felt about phone and mail interactions with your “office staff.” Clients will appreciate your personal concern for quality in those functions, especially if they weren’t impressed with your virtual staff. If you’re not satisfied with their performance, tell them clearly one more time what you expect, check again, and if they’re not performing, terminate the contract before the “test” period expires. Make sure your agreement with them includes a test period during which you can terminate their service with 7 to 30 days’ notice. And be sure to get non-disclosure agreements from your service providers. Your local attorney should help you with all the contract issues. A hundred dollars of lawsuit prevention is worth a hundred thousand dollars of legal remedy.

Get ready for a long learning curve. Parts of it will be shallow and feel like they’re taking forever. Other parts will be steep and feel like too much is happening too fast. You will have resounding successes and howling failures, and you will develop the discipline to learn from both.

Resources for new entrepreneurs

Notice: Mention of an organization or website in this article is NOT an endorsement or recommendation. These are examples only to kick-start your research for the organizations and sites that work best for you … emphasis on the “work.” You’ll have to define what you want from each type of resource first (such as health insurance, job postings, or advice). Then you can do a nicely focused investigation, picking the best one or several for your purposes.

Freelancer organizations. Consider joining organizations for freelancers in general and professional organizations for your industry to network aggressively. Some offer regional networking, health and/or dental insurance plans, and other benefits.

• Freelancers Union: Resources for all professions of freelancers. Membership is free. Visit http://www.freelancersunion.org/
• Profession-specific organizations. None are listed here because you have many to choose from, and several will work better for you than others, depending on what you need it for. Many profession-specific freelance sites are run by a freelancer who makes part of his or her income by maintaining the site (especially if you have to pay for a subscription to see the job postings and receive newsletters), sending newsletters, and hosting Google-Ads. You’ll have to explore those for your own best value.

Freelancer information. Websites offer information for freelancers. Most offer access to job postings, and resources for posting your profile, e-networking among members, subscription to newsletters.

• Solo Gig News: http://www.sologignews.com/
• All Freelance Work: http://www.allfreelancework.com/
• Quintessential Careers: http://www.quintcareers.com/consultant_jobs.html
• My Biz Office: http://www.mybizoffice.com/individuals/resources_consultantassociations.html
• Guru: http://www.guru.com/

Business start-up information. Websites offer information for those starting companies.

• Entrepreneur Magazine: Visit http://www.entrepreneur.com/ and the Starting a Business page at http://www.entrepreneur.com/bizstartups/index.html.
• Inc. Magazine: Visit http://www.inc.com/ and the Start Up page at http://www.inc.com/resources/startup/.
• WorkHappy.net: Visit http://www.workhappy.net/ and the Authentic Jobs page at http://www.authenticjobs.com/.
• MIT Sloan School of Management, Resources for the Entrepreneur: Visit http://web.mit.edu/e-club/hadzima/. Peruse the Boston Business Journal’s “Starting Up.” If you like this site, search other sites related to the best B-schools.
• Wall Street Journal’s Small Business News: Visit http://online.wsj.com/small-business.
• Garage Technology Ventures: Visit http://www.garage.com/resources/index.shtml.
• Industry-specific entrepreneur sites also provide helpful information, but they merit the same caveat as do the profession-specific freelancer sites. In addition to industry-specific entrepreneur sites, there are sites for women, green, international, non-profit, inventors, and other considerations that may span many industries.

You have now read the equivalent of three pages. That’s two more than a CEO would read. Your reading level is probably also higher than 7^th Grade. We’re done here. Now, focus like a laser on your goals. Go on … start up!

From The New York Times: 

 ”WASHINGTON — The Supreme Court ruled for older workers Thursday in a closely watched age discrimination case, placing on employers the burden of proving that a layoff or other action that hurts older workers more than others was based not on age but on some other “reasonable factor.” …

“[T]his decision, coming near the end of the Supreme Court’s term, completed a five-for-five sweep for employees’ rights in workplace discrimination cases that was little short of astonishing, given how far the court had appeared to be tilting toward business under Chief Justice John G. Roberts Jr. By comfortable margins, the court interpreted federal antidiscrimination statutes broadly to enable employees to overcome procedural hurdles and to pursue a category of claims not fully detailed in the statutes themselves.” …”

From EPI, the Economic Policy Institute:

“This morning, EPI Vice President Ross Eisenbrey issued the following statement on pending legislation to extend unemployment benefits:

“For months, as the nation’s economy has deteriorated, members of Congress have tried and failed to push through a common-sense extension of unemployment insurance benefits. Now there is another chance. House leaders plan to vote as soon as tomorrow (Wednesday) on a stand-alone extension bill passed Monday by the House Ways and Means Committee. The extension, which adds 13 weeks of benefits to unemployed workers who have exhausted their benefits, might also remain attached to the emergency supplemental appropriations bill for war funding. Congress should use every possible vehicle to put this issue before the president.

For the families of the millions of workers who are exhausting their right to unemployment compensation, the deteriorating job market is a real emergency. There are now only 3.7 million job vacancies but 8.5 million unemployed looking for work. The fault is not with the jobless; the problem is a failing economy and the government’s failure to turn it around.” The Congressional Budget Office estimates that the bill now under consideration will provide benefits to 3.8 million people who otherwise are at extreme financial risk. The benefits will also provide a crucial boost to the faltering economy. Now is the time to ensure that Congress takes action. EPI asks that you contact your local representatives in the House and Senate (names and addresses can be located at www.house.gov and www.senate.gov) and urge them to pass this needed legislation.”