The Long Gray Line

By Alexander L. Taylor III

Recession pushes unemployment to a post-World War II high of 9.4%

In August 1941, Ted Williams of the Boston Red Sox was on his way to batting .406. A pair of businessman's Florsheim shoes cost $9.50. The New York Telephone Co. reported that for the first time in ten years more phones were installed than disconnected. The Works Progress Administration, which only that year had begun making efficient monthly counts of the number of jobless in the U.S., announced that the unemployment rate for August was 9.7%.

Last week the unemployment rate reached the highest level since August 1941. In April 10.3 million Americans, or 9.4% of the labor force, were actively looking for work. That is an increase from 9% in March. When the Reagan Administration took office in January 1981, un employment stood at 7.4%. Sensing a potent political issue, House Democrats last week proposed to create a $2 billion jobs program.

The historic news came as no surprise. The gloomy April results had been expected for several weeks, as the economy continued to spiral downward. The unemployment rates for adult males, women who support families, teen-agers and blacks were already at record levels and they went still higher.

Joblessness has replaced inflation as the No. 1 concern of Americans. According to a Gallup poll taken last month, 44% of the public believe that unemployment is the "most important problem" facing the U.S. By comparison, only 24% said that they were most worried about inflation, which is only increasing at an annual rate of 1%, in contrast to 9.6% a year ago.

Unemployment in America is taking on new and startling dimensions. No longer are the bulk of layoffs confined to just autos and housing, which have been in a three-year slump. Unemployment has spread to textiles, pulp and paper, steel, oil drilling and refining, mining and chemicals. Along with union members and the semiskilled, white-collar workers are losing their jobs. Edward Lieberman, 28, was shocked when he could not find work after being laid off from his $20,000-a-year job as a computer-software salesman in Los Angeles. Said he: "I've discovered that I need three years' experience not just a skill."

States that once escaped widespread joblessness are now being squeezed. Booming Texas has been viewed as an El Dorado by laid-off auto and heavy-equipment workers who moved their families there from the Midwest. Now job seekers are finding that the recession has also hit Texas. New oil-and gas-well drilling is down 16.5%, and residential and commercial construction is weak. Two weeks ago, Harry Hubbard, president of the Texas AFL-CIO, warned the jobless to stay away. Said he: "Workers from the East and Northeast better have something lined up before they come down here, or they might find themselves in unemployment lines."

Other Sunbelt states are worse off. The unemployment rate in Alabama has reached 14%, the highest in the South, because of cutbacks in construction and manufacturing. The state prepared for another blow last week when U.S. Steel, which has already furloughed 3,500 of the 8,200 union workers at its huge Fairfield works, announced that it is considering closing the plant entirely. In Polk County, Fla., unemployment has hit 13% because of slumping demand for fertilizer made from phosphate mined in the area.

The widening ripples of the recession have dealt twin blows to the state of Washington, where unemployment is now 13%, the fourth worst in the U.S. The housing slump has pushed the lumber industry into a deep decline. Nearly one-third of the state's sawmills have closed, and employment has fallen by 13,400 since 1979. At the same time, Boeing, Washington's largest employer, says that the continued financial problems of commercial airlines will mean another 5,000 layoffs on top of the 5,000 who were let go in 1981.

Some workers who were hired at the peak of the aerospace business in 1981 and have since lost their jobs are angry. Machinist Marlin Carlton, 48, who moved his family from California last July on the promise of "eight to ten years work," is one of 13 Boeing job recruits who has sued the company after being laid off.

The Midwest remains the hardest-hit section of the country. The region is dotted with auto, steel and rubber plants that have simply been abandoned. Some experts believe that it will take perhaps ten years or more for parts of the Midwest to go through the painful process of shedding an old economic base and finding new sources of industrial might.

In Michigan and Ohio, efforts to attract new industry and retrain workers are drying up for lack of money. Says David Merkowitz, spokesman for a congressional group pushing for aid for the region: "There is a big difference between an auto-assembly worker and a highly skilled electronics assembler. You can't take a 22-year-old kid from the Detroit ghetto and put him to work on a complex weapons system."

One harsh solution to the unemployment problem has been adopted by a community action agency in Portsmouth, Ohio. It is using a federal grant to pay unemployed workers up to $638 in travel and job-hunting expenses to look for work. Irvin Buckner, 39, who was laid off by a Dayton Delco air-conditioning plant in 1979, used the money to travel to Longview, Texas, where he found a job at $225 a week with an air-conditioning sales firm. He is now living at the local Y.M.C.A. while he tries to save enough money so that his wife and daughter can join him.

There is no doubt that the recession has led to serious problems of human suffering. Bob Greene, 33, of Portland, Ore., is a former tire salesman who was laid off from his job six weeks ago. Separated from his wife and making child-support payments, he has been trying to get by on $158 a week in unemployment benefits. After years of donating his blood to the Red Cross, he decided to sell it instead and now markets up to two pints a week. Says he: "You can make about $100 a month, enough for a little better meal or an occasional date."

The plight of the jobless today is, of course, far different from what it was the last time the rate was at these levels. In 1941 unemployment insurance lasted only 13 weeks at most, and payments varied widely. A jobless worker in California could expect monthly benefits of $37.82, while a South Carolinian would get only $7.49. Today increased Government payments and union benefits have absorbed more of the financial pain. The average factory worker may qualify for unemployment aid that amounts to one-third of his lost income, and auto workers can receive 95% of their old take-home pay, or about $314 a week.

The great rise in two-income families has decreased, although not eliminated, the sting of unemployment. In 1941 only 29% of women were in the labor force, whereas today the figure is 52%. About half of all wage-earning families now have two or more salaries. Double joblessness, though, is becoming a problem. Last year the unemployment rate for women whose husbands were unemployed was about 18%.

Perhaps the greatest change of all since the Great Depression is in the general public's attitude toward unemployment. Says Columbia University Economic Historian John Garraty: "Then many people blamed themselves for not having work. Nowadays people accept unemployment as a social condition over which they have no control." One reason for this, according to Garraty, is the increased Government role in the economy. Many people now believe that public officials are actually inducing higher levels of joblessness in order to cool down inflation. Unemployment used to be "my" fault. Now it is "their" fault.

During the past 15 years, American policymakers have alternated between battles against inflation and struggles against unemployment. When price increases became unacceptable, the economy was slowed down until joblessness rose too high. Then the Government would start fighting unemployment, until prices again got out of control. The main effect of this on-again, off-again policy over the long run has been both more inflation and more unemployment. Another switch in programs would unfortunately wipe out the recent progress made against inflation without providing any lasting relief against the terrible plague of unemployment. --By Alexander L. Taylor III. Reported by Gisela Bolte/Washington and Barbara B.Dolan/Detroid

With reporting by Gisela Bolte/Washington, Barbara B. Dolan/Detroit

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