Amid the layoffs that have become a routine part of corporate downsizing, mergers and outsourcing, there is a growing trend: older executives who can't find new jobs.
Few of these managers ever imagined this could happen to them at what was supposed to be the pinnacle of their careers. But after aggressive job hunts, many former executives discover that even though the economy is picking up, new managerial jobs tend to go to younger workers. Some have responded by starting their own businesses or trying consulting, but others have essentially been forced into early retirement, sometimes many years short of their financial goals.
"There is a surplus of labor in this country, and if you are an older worker, it is very hard to find something," says Joseph Briley, an information technology executive who has been jobless for three years. "This all gets swept under the rug because these are not people standing in bread lines. But there are a lot of us."
Beyond the personal toll of such displacement, there is a gnawing concern about the long-term cost to society of losing so much talent and experience. The problem could become even more acute as the baby boomer generation ages: Some of those now being displaced are from the first years of the boom generation.
"There is a lot of collective experience that is being lost," says John Abrams, 56, who was a senior vice president for media relations at Visa before losing his job last July. He is looking hard for a new job because he still feels he has many years left to contribute. "There is an advantage to experience," he says.
Briley, who graduated from Harvard Business School in 1977, says he runs into people like himself everywhere he goes. At a gathering of about 40 business school colleagues in New York last week, he says he spoke to only one person who was fully employed.
"If you are in your late 40s or 50s and get caught up in one of these things, it is just a bad situation," says Briley, 58, a veteran of Merrill Lynch and Citibank. Once able to count on a six-figure salary, he is now getting ready to sell his house. "I have more or less realized I am not going to get employment again," he says.
"Nobody really wants to talk about the issue," he says. "But there is all this intellectual talent just sitting out there."
Exact figures on how many older workers have been shut out of the labor market are hard to come by, but experts say the number appears to be rising. Between February 2000 and January 2002, for example, the re-employment of workers between the ages of 55 and 64 sank from 58.8 percent to 52.5 percent, the lowest rate since at least 1994, according to the Bureau of Labor Statistics.
"There is absolutely no question that if you are an older worker, your chances of being re-employed are much smaller and the probability of dropping out of the labor force is much greater," says Sara Rix, a senior policy analyst at AARP.
Especially hard hit are industries like banking, where there have been a lot of mergers and consolidation, and sectors like telecommunications, where drastic downsizing has left tens of thousands out of work. The bulk of these jobs will never come back. Some of the reductions are voluntary and cushioned by severance packages. But after those run out, there is a period of harsh reality that is often difficult for these former executives to grapple with.
"I like to be frank with them. There are half as many companies in telecom as there were a few years ago, so there are half as many jobs," says Jerry A. DeMartino, a former MCI executive who is the founder and chief executive of Competitive Telecoms Group, a recruiting and consulting firm. "It's sad. Most of the time I am more like a counselor than a recruiter."
DeMartino and others say the workers who do best are those who admit at the outset that it is unlikely they will get a job in the same sector and who attempt to switch gears.
That's what Eldon Blust did. A former sales and marketing director at MCI, he made plans to retire early in 1999, soon after WorldCom purchased the company. He sold his home in northern Virginia, moved to South Carolina and went into real estate. So far this year, Blust, 62, has sold about $7 million of property in the Seneca area. But he knows many former executives who are struggling.
"There are a lot of wandering souls out there," says Blust. "There are a lot still trying to find something to do, going from one consulting job to another. It is harder, the higher up you go."
Karen Hochman sees the same thing at the Marketing Executives Networking Group, an idea and information exchange where displaced executives often seek leads and help. Membership is exclusive, limited to executives who either have a title of at least vice president or a base salary of $150,000 or above. When Hochman founded the New York chapter after being downsized herself in 2001, the group had 225 members. It now has more than 1,200 nationwide.
Layoffs of older executives are "like the thing which has no name. People won't talk about it," says Hochman. "There is a whole generation of people who are going to be shortchanged, without the last 10 years of income they needed for their retirement."