July 08, 2009

Unemployment and Socioeconomic Status

author_karen By Karen Sternheimer

Being unemployed can be an incredibly stressful experience. Difficulty paying bills is the most obvious stressor, but there are others: the threat of losing a home, feeling rejected while looking for a new job, and declining self-esteem are others. How do you now answer the question, “what do you do?”

Yet the challenges of unemployment are not equal opportunity experiences. An individual’s socio-economic status (SES) makes a big clip_image002difference; two people standing next to each other in line at an unemployment office might have very different realities.

Socio-economic status is a collective measure of status based on education, income, wealth, and occupation, as well as an individual’s family background: parents’ education, income, wealth and occupation. All of these impact how a person will experience unemployment.

For instance, someone with more education is less likely to be unemployed. As you can see from the graph below, people without a high school diploma were three times more likely to be unemployed as those with bachelor’s degrees were in 2008. And because median earnings are higher with more education, people with college degrees might be more likely to have savings to dip into should they become unemployed.


Source: Bureau of Labor Statistics

And yet for those people who are highly educated and unemployed—note the 2% with doctoral degrees who were unemployed in 2008—the sense of personal failure might be more significant. One possible silver lining to being unemployed during a recession is that a person might know many others in the same situation and therefore take their situation less personally. People with higher levels of education may feel more isolated if they are unemployed.

Another factor defining SES is occupational prestige, which can also shape how someone experiences unemployment. For example, a friend of mine who held an executive-level position lost her job when her company was bought out by a competitor. She was given nine months severance pay of her full salary and decided to start her own business, knowing that she would still collect a significant paycheck for several months. For other people accustomed to not just a high salary, but the power and authority that comes with a high-prestige position, it may be tough to accept that a high-level job might not open up for them.

This is one example of the downward mobility many people are experiencing right now. Aside from having less money to spend and having to alter their lifestyle, finding a job with less prestige also means a shift in one’s social standing and sense of self.

But for some people, who maybe identified too much with their work, unemployment seems to be liberating. In a recent article, the Los Angeles Times described how some clip_image006people, mostly young and single, experienced “funemployment” by going to the beach, hanging out with friends, and even doing volunteer work. “And at least till the bank account dries up, they’re content living for today.”

Another Times article describes how to have fun in Las Vegas after losing a job by going to the cheaper restaurants in the older, downtown area of Fremont Street. “Vegas is not just the high-priced adult Disneyland I used to revel in. It has spirit and (dare I say it?) soul, and it was totally worth dipping into my severance package.”

The author also described how her newly unemployed status meant she would be mingling with a different crowd that she was used to: “Signs warn patrons not to smoke in line and not to steal the glasses. How enchantingly old school. But the jeans-and-T-shirt-wearing crowd said ‘Midwestern tourist’ more than hip gambler.”

It’s interesting how the author conflates downward mobility with people from a certain region of the country (as a native Midwesterner this rankled me a bit), but it is also a way of trying to distinguish one’s sense of self at others’ expense. A letter to the editor later chided the author for going on vacation at all while she was unemployed.

Clearly having a severance package, previously holding a high paying job, and not having a family to support might make the unemployment experience easier. So too might having a social network with valuable job connections, and family members willing and able to provide financial support and/or a place to live in the meantime. What other factors might make unemployment easier? What might make it more difficult?


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I had a period of “funemployment" recently. I lost my job when the school year ended but I had enough saved to cover myself for the two months of unemployment I had to deal with. I'm 19 years old and I live on my own, so finding a new job was vital to me not having to move back home.

Being a sociology major, I can view my situation objectively. I was never in any danger of having to "suffer" my own poverty because I knew I always had the option of going back home. So I enjoyed my time of freedom. Money makes us slaves and it was nice to not be a slave for once.

I think more young people today are able to have “funemployment" times because our previous generations flourished during times of economic awesomeness. Our parents and grandparents who come from 3rd or 4th generation families offer a safety net of financial stability.

More evidence of money privilege in America? I was able to travel to Santa Cruz and see friends, party, do some long distance cycling, and all the other things we like to do in a spare time. The funny thing about time however, is that it was all spare time. I felt good about myself and I felt like I was closer to me. Once money started getting tight however, my laziness turned to worry, and then into anxiety... but all the while I knew I could always go back home.

I found the job(s) I needed to keep going but what about the millions of other kids my age and adults who never get to experience this because their families do not come from such established or stable backgrounds? Today I was reading about the 70,000 construction workers in S. Africa who are on strike until they receive a 13% raise. I did the math, even with the raise these guys will only be making about $350 dollars a month.

I'm a barely twenty year old white kid in Fresno, CA and I'm making double that in a month, at the least. It just blows my mind sometimes how privileged I really am. And I don't even have that much. I have friends that are much more wealthy and I have friends who come from unstable and poorer backgrounds. I've always been in the middle, and being in the middle helps you see and experience life from both sides. Sure, my less fortunate friends qualify for certain financial aid services that I would not qualify for because my parents make just enough money, but even with my parents humble jobs as a school teacher and a city employee... is it really all that fare that I get to enjoy “funemployment"?

This article reminds me once again of two major things: (1) how important education really is. (2) how important it is to constantly build yourself up, think in terms of being financially independent, have insurance and savings etc.

I have always headed to being self-employed, during different times of my life: employment period (being an employee), then when I was a stay-at-home mom with a toddler and eventually now, when I'm eager to build something on my own.

As I mentioned in the beginning of my post, I consider insurance and backup one of the most important and essential attributes of our versatile life with the credit-economy, all these economy-bubbles followed by crushes, and so on.

This article helped me to articulate my own thoughts into a more distinct shape. Thanks!

1.How does a person's socio-economic status (SES) affect his or her experience of unemployment?
I believe it does affect some one's employment status. There are many companies hier someone based on who they are not their experience. and someone who is over experienced does not stand a chance because they are not well known. It is not fair but just the way society is.

the only thing that got was when you said people with college degree have a savings to dip into if unemployed. no we don't, not really. we have our student loan bills to pay off and also trying to find a job with a degree is just as equal as hard. I have been at both ends of the spectrum.

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