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75–751 PDF 2012

S. HRG. 112–541 

MISSED BY THE RECOVERY: SOLVING THE 

LONG-TERM UNEMPLOYMENT CRISIS FOR OLDER 

WORKERS 

HEARING 

BEFORE THE

SPECIAL COMMITTEE ON AGING 

UNITED STATES SENATE 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

WASHINGTON, DC 

MAY 15, 2012 

Serial No. 112–16 

Printed for the use of the Special Committee on Aging 

( 

Available via the World Wide Web: http://www.fdsys.gov 
(II) 

SPECIAL COMMITTEE ON AGING 

HERB KOHL, Wisconsin, Chairman 

RON WYDEN, Oregon 

BILL NELSON, Florida 

BOB CASEY, Pennsylvania 

CLAIRE MCCASKILL, Missouri 

SHELDON WHITEHOUSE, Rhode Island 

MARK UDALL, Colorado 

MICHAEL BENNET, Colorado 

KRISTEN GILLIBRAND, New York 

JOE MANCHIN III, West Virginia 

RICHARD BLUMENTHAL, Connecticut 

BOB CORKER, Tennessee 

SUSAN COLLINS, Maine 

ORRIN HATCH, Utah 

MARK KIRK III, Illnois 

DEAN HELLER, Nevada 

JERRY MORAN, Kansas 

RONALD H. JOHNSON, Wisconsin 

RICHARD SHELBY, Alabama 

LINDSEY GRAHAM, South Carolina 

SAXBY CHAMBLISS, Georgia 

CHAD METZLER, Majority Staff Director 

MICHAEL BASSETT, Ranking Member Staff Director 
(III) 

C O N T E N T S 

Page 

Opening Statement of Hon. Herb Kohl, U.S. Senator from Wisconsin ............... 1 

Statement of Hon. Bob Corker, U.S. Senator from Tennessee ............................ 2 

PANEL OF WITNESSES 

Statement of Sheila Whitelaw, Unemployed Older Worder, Philadelphia, PA .. 3 

Statement of Charles A. Jeszeck, Director, Education, Workforce, and Income 

Security, U.S. Government Accountability Office, Washington, DC ................ 4 

Statement of Joseph Carbone, President and CEO, The Workplace, Bridgeport, CT ................................................................................................................. 5 

Statement of Diana Furchtgott-Roth, Senior Fellow, Manhattan Institute, 

New York, NY ...................................................................................................... 7 

Statement of Christine Owens, Executive Director, National Employment Law 

Project, Washington, DC ..................................................................................... 9 

APPENDIX 

WITNESS STATEMENTS FOR THE RECORD

Sheila Whitelaw, Unemployed Older Worker, Philadelphia, PA ......................... 18 

Charles Jeszeck, Director, Education, Workforce and Income Security, U.S. 

Government Accountability Office, Washington, DC ........................................ 20 

Joseph Carbone, President and CEO, The WorkPlace, Bridgeport, CT .............. 39 

Diana Furchtgott-Roth, Senior Fellow, Manhattan Institute, New York, NY ... 44 

Christine Owens, Executive Director, National Employment Law Project, 

Washington, DC ................................................................................................... 59 

RELEVANT WITNESS REPORTS

Unemployed Older Workers: Many Experience Challenges Regaining Employment and Face Reduced Retirement Security, U.S. Government Accountability Office ......................................................................................................... 74 

The Old Prosper Relative to the Young: The Rising Age Gap in Economic 

Well-being, Pew Social & Demographic Trends ................................................ 164 

ADDITIONAL STATEMENTS SUBMITTED FOR THE RECORD

Easter Seals, Inc., Washington, DC ....................................................................... 202 

(1) 

MISSED BY THE RECOVERY: SOLVING THE 

LONG-TERM UNEMPLOYMENT CRISIS FOR 

OLDER WORKERS 

TUESDAY, MAY 15, 2012 

U.S. SENATE, 

SPECIAL COMMITTEE ON AGING, 

Washington, DC. 

The Committee met, pursuant to notice, at 2:17 a.m., in Room 

SD–562, Dirksen Senate Office Building, Hon. Herb Kohl, chairman of the committee, presiding. 

Present: Senators Kohl [presiding], Blumenthal, and Corker. 

OPENING STATEMENT OF SENATOR HERB KOHL, CHAIRMAN 

The CHAIRMAN. Good afternoon. We’d like to thank our witnesses 

and at the same time welcome everyone attending today’s hearing. 

While Americans were hit hard by this recession, the ramifications for older workers are particularly severe. Once older workers 

lost their jobs, they struggled far more than other groups to find 

work again. In 2007, less than one in four unemployed older workers was out of work for more than half a year. But only four years 

later, more than half of unemployed workers over 55 are confronting long-term unemployment. 

As a bipartisan opinion in the New York Times over the weekend 

stated, this problem is, quote, ‘‘nothing short of a national emergency.’’ One solution that shows real potential was developed in 

Connecticut by one of our witnesses here today, Joe Carbone. He 

has created an innovative program called Platform to Employment 

that works individually with those out of work to ensure that they 

have updated skills to thrive in today’s economy. The program 

partners with local businesses to place these workers into internships. 

So far, 70 percent of those internships have turned into jobs. 

This program shows real promise to get people back to work and 

I believe it needs to be spread across the country. 

However, it’s also important that we look at some of the other 

reasons why older workers have been kept out of work for so long 

and address what we can do about it. We asked GAO to look into 

the issue and it found that employers are wary of hiring older 

workers, sometimes because they’re concerned about health care 

costs, but other times because they assume that if one is over 55 

or has been out of work then your skills are not up to date. 

GAO surveyed experts who highlighted a number of approaches 

the government could take to help address this problem. One sug-
2 

gested approach addressed in my Older Workers Opportunity Act 

would provide tax credits for businesses employing older workers 

with flexible work programs. 

Another area the experts mentioned is discrimination. Today I’m 

announcing my support for the Protecting Older Workers Against 

Discrimination Act, a bill authored by Senators Harkin and Grassley that is aimed at restoring the rights of older workers to pursue 

claims of age discrimination. 

One common theme we’ve heard is that older workers want to 

keep working, not only because they need the money, but because 

they want to remain relevant and productive members of society. 

We need to encourage this. Left unchecked, long-term unemployment among older workers is a problem that will continue to grow 

as our work force grays. In only four years from now, the Bureau 

of Labor Statistics projects that nearly one in four workers will be 

over the age of 55. We hope this hearing raises awareness about 

this growing problem and provides some solutions to consider. 

We’ll now go to witness introductions. Our first panelist today is 

Sheila Whitelaw, a Philadelphia woman who has been out of work 

for more than two years. She has served as executive director for 

three nonprofits, worked as a nanny and office manager, and spent 

over a decade in the retail industry. 

Next we’ll be hearing from Charles Jeszeck. He’s Director for 

Education, Workforce, and Income Security Issues at the U.S. Government Accountability Office. He’s spent over 26 years with GAO 

working on issues concerning defined benefit and defined contribution pensions, PBGC, social security, unemployment insurance, as 

well as older worker unemployment issues. 

Next we’ll be hearing from Joe Carbone, who’s President and 

CEO of The WorkPlace in Bridgeport, Connecticut. Mr. Carbone 

has developed the Platform to Employment, a public-private partnership that provides participants with placements at local companies. His program has been featured on 60 Minutes in a segment 

titled ‘‘Trapped in Unemployment.’’ 

Next we will be hearing from Diane Furchtgott-Roth. She’s a 

Senior Fellow at Manhattan Institute for Policy Research. Formerly Ms. Furchtgott-Roth served as Chief Economist at the U.S. 

Department of Labor, as well as Chief of Staff, President George 

Bush’s Council of Economic Advisers. 

Finally, we’ll be hearing from Christine Owens. She’s the Executive Director of the National Employment Law Project. Ms. Owens 

previously served as Director of Public Policy for the AFL–CIO and 

founded and ran the Workers Options Resource Center, which 

fought for an increase in the Federal minimum wage. 

Before we hear from our first witness, we’d like to turn to Senator Corker for whatever comments he has. 

STATEMENT OF SENATOR BOB CORKER 

Senator CORKER. Chairman, thank you. And I know we’re having 

a series of votes and thought for a moment this hearing had been 

called off. So I apologize for being a few minutes late. Thank you 

for being here and I appreciate your focus on long-term unemployment among seniors. I know we have some great witnesses here 

today. 
3 

I think we all recognize that long-term unemployment is actually 

hitting lots of demographic groups. Obviously, we don’t want to 

pick winners and losers in that. But I certainly am glad we’re having this hearing and look forward to questions and comments after. 

And thank you for calling it. 

The CHAIRMAN. Thank you very much, Senator Corker. 

Ms. Whitelaw. 

STATEMENT OF SHEILA WHITELAW, UNEMPLOYED OLDER 

WORKER, PHILADELPHIA, PA 

Ms. WHITELAW. Good afternoon. My name is Sheila Whitelaw. I 

am British by birth and, I’m proud to say, an American citizen. I 

have been an executive director of three nonprofit organizations. I 

have also worked as a nanny and an office manager and have spent 

over a dozen years in the retail sector. I have been promoted in 

many of the jobs I have had and have never been fired. I have an 

impeccable work history, but now I am out of work and no one will 

hire me. 

I came to this country with a bachelor’s degree in English literature. I married and had two daughters. We moved from the city 

of Philadelphia to the suburbs so that my daughters could receive 

a great education. Once my children got a bit older, I decided I 

needed to go back to work. I found a position as an office manager 

and stayed for eight years. 

I then worked for three nonprofit arts organizations. My final position as executive director was cut short as my daughter was diagnosed with leukemia. Our family moved out to Seattle for five 

months so that my daughter could receive a bone marrow transplant. 

Upon returning to Philadelphia, I cared for my daughter for another year. I was in more of a caregiving mode and at that time 

I found a part-time nanny position. I stayed with the family for 

four years and then decided that I missed working with adults and 

found a job selling women’s clothing. In my 12 years at the boutique, I worked my way up from sales associate to manager. 

But, unfortunately, in January 2010 the store lost its lease and 

the owner decided not to reopen. I applied for unemployment benefits and was approved. Then came the hardest part of all, looking 

for work as an older worker. I didn’t know how long it might take 

to find a job, the economy was in such bad shape. These past two 

years have been a complete nightmare. 

I have sent out hundreds of resumes and made many cold calls, 

as well as attending job fairs. I spend several hours every single 

day, including weekends, searching for openings on the Internet. I 

have had over 15 interviews, but rarely have I received a response. 

I gather that many employers can calculate my age by looking 

at my resume or looking me up on line. Many applications require 

that I put my date of birth to even submit the forms, and I suspect 

I am weeded out in that process. I have also stopped putting the 

date of the boutique closure on my application for fear that employers will see how long I have been out of work and judge me because 

of that. 

Last summer as my unemployment benefits ran out, I had to put 

my husband in a nursing home because of his increasing inability 
4 

to take care of himself with Alzheimer’s. I moved to a smaller 

apartment and took a position in a hotel gift shop. The conditions 

were absolutely deplorable and, after finding mice droppings in my 

handbag, I quit. Although the State informed me that I might be 

eligible for a recent extension of unemployment benefits, I had forfeited my eligibility because I left the job after four days of work. I now live on my social security and $35 a month in food stamps. 

Life is exceedingly hard. I am working with a social worker to find 

subsidized housing for me in the future. I can work, I need to work, 

and I want to work, but that seems very far off right now. 

I didn’t have any real retirement money and a small savings accounts is almost depleted. At this point I don’t expect to retire, 

even if I’m able to find a job. I plan to keep working as long as 

I am physically able and I am blessed to be in good health. 

Contrary to what employers think, age is just a number. My age 

does not define my ability, negate my work experience, or reduce 

my dedication to the job at hand. 

I thank you for the opportunity to tell my story today and I look 

forward to answering any questions that you may have. Thank you. 

The CHAIRMAN. Thank you very much, Ms. Whitelaw. 

Ms. WHITELAW. Thank you. 

The CHAIRMAN. Mr. Jeszeck. 

STATEMENT OF CHARLES A. JESZECK, DIRECTOR, EDUCATION, WORKFORCE, AND INCOME SECURITY, U.S. GOVERNMENT ACCOUNTABILITY OFFICE, WASHINGTON, DC 

Mr. JESZECK. Mr. Chairman, members of the committee: Thank 

you for inviting me here today to discuss the labor market experiences of older workers since the recession of 2007. The recession 

has had a devastating effect on millions of workers of all ages, resulting in lost economic growth and reduced income and in the 

stress of having to seek new work simply to pay the bills. 

My comments are based on the findings of our report that this 

committee is releasing today. In particular, I will focus on the 

growth of long-term unemployment among older workers and its 

implications for their retirement security. In summary, while older 

workers are less likely to lose their jobs compared to younger workers, it takes them longer to find new work. Further, if they are 

lucky enough to be rehired they are more likely to be reemployed 

at lower wages. 

Regarding retirement, long-term joblessness can lead to reduced 

future accruals for workers with traditional pensions, while workers with 401[k] plans will lose contributions or may draw down 

their accounts. In each instance, older workers have less time to recoup their losses than do younger workers. 

As in past recessions, the jobless rate for older workers has been 

lower than for younger workers. The jobless rate for workers age 

55 and over peaked at 7.6 percent in February 2010, compared to 

January 2010 peak of 10.6 percent for all workers. 

However, older workers consistently suffer longer spells of unemployment. In 2007, the median duration of unemployment was ten 

weeks for older workers, compared to nine weeks for prime age 

workers age 25 to 54. By 2011, the median duration for older workers had increased to 35 weeks, compared to 26 weeks for prime age 
5 

workers. Also in 2011, over half, 55 percent, of jobless older workers were unemployed for 27 weeks or more and 15 percent were 

jobless for 2 years or more. 

Rehired older workers displaced from work between 2007 and 

2009 also generally sustained greater earnings losses than prime 

age workers. The median earnings replacement rate for these older 

workers was 85 percent, meaning that on average older workers in 

their new jobs earned only 85 percent of their previous wage. This 

is compared to 95 percent for prime age workers. About 70 percent 

of these rehired older workers sustained some job loss, compared 

to 53 percent of prime age workers. 

Job loss can affect the retirement security of older workers in 

many ways. For those fortunate enough to have a traditional pension, long-term unemployment can lead to fewer years of accruing 

benefits from growth in wages in service and may prevent shorttenured employees from vesting. For those workers with 401[k] 

plans, long-term joblessness can result in lost employee and employer contributions and can lead a worker to draw down her account balance. 

In our report we analyzed a worker 55 years of age with an average 401[k] balance of $70,000 who was unemployed for 2 years, 

drew down half of her account for living expenses, and then reinstituted contributions upon reemployment. Using rate of return 

assumptions from SSA, we found that she had still not made up 

the losses to her account by age 62. 

Such drawdowns may be fairly common. An October 2011 AARP 

survey of workers age 50 and over found that nearly a quarter said 

that they had used all of their savings during the past three years. 

Long-term joblessness also hurts those workers who rely primarily on social security. Although it favors low earners, because 

the social security retirement benefit formula relies on claimant’s 

highest 35 years of wages long-term joblessness of a year or two 

could reduce their benefit. Further, long-term unemployed workers 

nearing age 62 may opt to claim benefits earlier than they would 

have if they had still been working. The SSA Office of the Chief 

Actuary has estimated that about 6 percent, or 139,000, more older 

workers filed for benefits between 2007 and 2009 than had been expected without a recession. Claiming benefits early, particularly for 

life-long low earners, can increase the risk of poverty at older ages. 

Even in the best of times, a secure retirement is a difficult prospect, especially for those workers with no traditional pension and 

little retirement savings. The effects of the recent recession illustrate how daunting that endeavor will be for many in the years to 

come. 

That concludes my statement, Mr. Chairman. I will be happy to 

answer any questions you or other members may have. 

The CHAIRMAN. Thank you very much, Mr. Jeszeck. 

Mr. Carbone. 

STATEMENT OF JOSEPH CARBONE, PRESIDENT AND CEO, THE 

WORKPLACE, BRIDGEPORT, CT 

Mr. CARBONE. Thank you, Senator Kohl and Senator Blumenthal 

from Connecticut for joining us. I’m going to summarize my written 
6 

testimony—I’m going to be summarizing my written testimony that 

I gave you. 

Certainly the word ‘‘scourge’’ is a strong word and I think it understates the level of social change that is being caused to the 

American workforce as a result of this horrible recession. It’s not 

just the number of people that are unemployed; that in and of itself 

is certainly staggering. It’s the length of unemployment that really 

does present the greatest challenge to the American workforce system. 

It’s not unusual, in fact it’s a daily occurrence, that you’re interacting with people who have been out of work two, three, four 

years. It’s not uncommon. Understanding and developing an appreciation for the damaging effects of long-term unemployment is 

something for national discussion and I commend you for bringing 

it up here. I saw the same article in the New York Times over the 

weekend. 

Something happens at the one-year point of unemployment. It’s 

terribly insidious and it’s kind of structural. We hear the term 

‘‘structural’’ usually in reference to the economy, but something 

structural with respect to the person. It’s the mind. It’s no longer 

just being out of work; it’s the mind. It’s one’s self-esteem, it’s one’s 

confidence. It’s the emotional effect that unemployment has with 

respect to family and children and how you feel about life and 

things of that sort. 

At a time when it’s more and more difficult to convince business 

that you’re the right candidate for the job, where you need to be 

at your best, it seems to be a case in which you’re facing a mountain of challenges. 

Overcoming this is really daunting for anybody, but it’s compounded for older workers. They’re dealing with the stigma of 

being older. They’re dealing with the prejudices that come with it, 

with the discrimination that comes with it, and this mean perception that lots of folks have that you’re looking for something for 

nothing or your skills are too dull to be of help to anybody. It’s a 

challenge if you’re under 50. It’s a category 5 hurricane if you’re 

over 50. 

I fear that we’re losing the battle. We’ve already had thousands 

of people in this Nation reach the point where their benefits have 

expired and thousands more every week fall into that category. 

And until or unless there are relevant services and tools that are 

part of the American workforce system, that understands the effects of long-term unemployment and provides them for this population, so that population stays connected to the system and is 

served, we will continue to lose them. 

That one-year point of unemployment is a critical time to either 

keep them and catch them or to lose them. Three million people or 

more have exhausted benefits already and another three million 

may very well exhaust benefits by the end of this year. 

Now, there’s no shortage of stats. You’ve heard them all. But the 

increase in terms of the percentage of the population of 55 and 

older that are unemployed for a year is four times what it was four 

years ago. 

Our program that you made reference to, Senator, Platform to 

Employment, was basically a research project, and I think very 
7 

clearly it showed that if you address the issues of one’s self-confidence, the emotional issues, and you recognize the position of benefit, the buyer’s market that business has, you can’t help to give 

them a chance to reenter the workforce. Short of that, it’s very, 

very difficult. 

Now, time may be kind of running out here. As I said before, the 

one-year point is that point. But we’re going to be having what 

could be two or three million people reach the conclusion of benefits 

at the end of this year. It could be 25 to 30 percent of them might 

very well be people that are 55 and older. 

The more time that people are unemployed, the more hopeless 

and desperate that they become. After a while they stop looking for 

work, they give up, and they rely upon the regional safety net for 

support. 

So I gave a lot of ideas and suggestions in my testimony, but let 

me just highlight a couple. The SCSEP program, the Senior Community Service Employment Program, may not have been designed 

for this particular population, but I think it’s a service vehicle that 

you should consider. It keeps the focus on employment. I see no 

merit whatsoever in moving this program from the U.S. Department of Labor to HHS. This is a plan that’s been considered for two 

or three years. It sends exactly the wrong message to older workers 

in particular who are long-term unemployed that you’re a social 

service issue, you are not an employment issue. 

You ought to take that program, examine the regulations, declare 

long-term unemployed people a group that is a priority in the program, and consider the investment option that I made in my testimony, the cost of the safety net, as opposed to the cost of investment in the person in the program. Do a pilot project. I suggest to 

you that it will be thousands of savings per person to invest on the 

employment side as opposed to the safety net and, most important, 

you’re giving people a chance to have the American dream and to 

have opportunity, which is a basic fundamental right of being an 

American. 

Thank you. 

The CHAIRMAN. Thank you very much. 

Ms. Furchtgott-Roth. 

STATEMENT OF DIANA FURCHTGOTT–ROTH, SENIOR FELLOW, 

MANHATTAN INSTITUTE, NEW YORK, NY 

Ms. FURCHTGOTT-ROTH. Thank you very much. 

Unemployment is a serious issue for older workers and also a 

problem for other workers. Millions of Americans are looking for 

work. I agree that older workers face serious difficulties in today’s 

underperforming labor market, but I disagree with the GAO report’s implication that the problems facing older workers require 

policies that treat older workers differently from younger workers. 

Such policies would needlessly set one generation against each 

other. They rest on the false premise that the problems facing older 

workers are the result of discrimination or other factors that work 

specially against older workers and in favor of younger workers. 

In fact, the problems facing older workers in today’s stagnant 

labor market are not dissimilar from the problems facing all workers—lack of robust growth. Look at this chart, figure 2 in my testi-
8 

mony, which unfortunately I was not allowed to place on an easel, 

which my research assistant is holding. Over the past ten years, 

employment has increased among Americans 55 and older by 8.9 

million. At the same time, it has declined by 3.1 million in the 25 

to 54 age group and declined by 313,000 among those age 20 to 24. 

Figure 3 shows the labor force participation rate of seniors has 

increased by 5.7 percentage points over the past ten years. Yet it’s 

declined in other age groups. 

Figure 4 shows that, compared with those age 20 to 24 and 25 

to 54, unemployment rates are lowest for those 55 and over and 

have seen the smallest increase over the past decade. 

In November 2011 the Pew Research Center issued a lengthy 

study entitled ‘‘The Rising Age Gap in Economic Wellbeing,’’ which 

I would like to submit for the record. 

It concluded that the gap in wellbeing between older and younger 

workers was at a record. The older group had 47 times the net 

worth of the younger group in 2009, compared to a multiple of 10 

in the quarter before. Older Americans, the report from Pew concluded, had benefited from appreciation of their homes, higher incomes, and lower unemployment rates. Younger workers have student loans and no jobs. 

Speaking of the New York Times, this weekend there was a 

lengthy article called ‘‘A Generation Hobbled by the Soaring Costs 

of College,’’ showing that debt among some students they interviewed was $125,000 when they graduated. 

The reality is that the administration’s policies have failed across 

the board and resulted in a serious deficit of employment opportunities for all workers, old and young alike. The problem will not be 

solved by special policies that favor one group over another. What 

we need instead are policies that broadly create more job opportunities for all, with older workers benefiting as much as younger 

workers. 

Just a few sample policies: Add more certainty to the tax system. 

Rates on income and capital are scheduled to rise dramatically 

next January 1st, creating extensive uncertainty and what some 

people have called ‘‘Tax Armageddon.’’ Older Americans are disproportionately hurt by tax uncertainty because they have fewer 

opportunities to react to changes, particularly those affecting capital gains. 

Another example that we could do is eliminate the Environmental Protection Agency’s new regulations on coal, which are affecting the utility sector, which employs a disproportionate number 

of older workers. Over 100 coal-fired plants have closed since January 2010. The closing of coal-fired plants causes electric utilities to 

require higher rates, which harm older Americans on fixed incomes. 

If we approved the Keystone XL Pipeline, Canadian oil could go 

to our refiners in the Gulf to be made into gasoline and other products. Millions of older Americans live in the States that would benefit from these construction projects. 

One proposed bill that would interfere with job creation is S. 

1471, the Fair Employment Opportunity of 2011. The bill would set 

up another protected class of workers, the unemployed. The unemployed would be allowed to sue employers for discrimination. This 
9 

would increase the cost of hiring American workers, making it 

more likely that employers would expand plants offshore, making 

America a less favorable place to do business. Employers would 

face more paperwork to show that they weren’t discriminating 

against the unemployed, and trial lawyers would target companies 

with threats of lawsuits. 

Thank you very much for inviting me to testify today and I 

would be glad to answer any further questions. 

The CHAIRMAN. Thank you very much. 

Ms. Owens. 

STATEMENT OF CHRISTINE OWENS, EXECUTIVE DIRECTOR, 

NATIONAL EMPLOYMENT LAW PROJECT 

Ms. OWENS. Thank you, Chairman Kohl, Ranking Member Corker, and Senator Blumenthal. Thank you very much for convening 

this hearing today into the problems older long-term unemployed 

workers face in navigating the labor market and possible solutions 

to these difficulties. 

I also want to compliment the General Accounting Office for its 

thoughtful review of these problems, which included a survey of existing research and polling, as well as its focus groups that enriched its presentation of the problems older unemployed workers 

are facing. 

As we discussed in our written statement today, older workers 

are less likely to become unemployed, but when they become unemployed they are more likely to remain so and to remain so for 

longer periods of time. Moreover, older unemployed workers are 

three times as likely as younger unemployed workers to become 

unemployed because they have lost their jobs, and in contrast 

younger workers are three times as likely to be unemployed because they are looking for a first job or reentering the workforce, 

perhaps after finishing college. 

Each group would benefit from public and private policies that 

take into account the discrete problems that they face. As Senator 

Corker said, we don’t want to pick winners and losers. But public 

policy responses to an unemployment crisis is not a zero sum game. 

We can walk and chew gum at the same time. 

There are two bills currently pending before Congress that we 

believe would enhance prospects for older long-term unemployed 

job-seekers. The first is the Fair Employment Opportunity Act, and 

I’m sorry that Senator Blumenthal had to step out since he’s the 

chief sponsor of this legislation. It would bar employers and agencies from refusing to consider or hire qualified individuals simply 

because they are unemployed. It does not promise a job to any candidate. It does not require employers to consider unqualified candidates. It simply opens the doors that are now shut on qualified 

applicants simply because they are unemployed. 

Similar to existing workplace laws it borrows from, it provides a 

cause of action for job applicants and remedies for applicants, applicants wrongfully denied the opportunity to apply for a job. And 

it preserves the right of employers to impose an employment restriction where doing so is a legitimate criterion for the job in question. 
10 

This legislation is a commonsense solution to a problem that, despite considerable public attention over the last couple of years, has 

actually persisted. As we’ve outlined in our testimony today, recent 

advertisements continue to express restrictions to limiting job 

openings to those who are currently employed. We hear complaints 

from unemployed workers like Sheila all the time, who come to us 

with their accounts of having been approached by a recruiter and 

then, once the recruiter learns the person is unemployed, the person won’t be considered. I’ve outlined examples of those. 

Also in our testimony we cite examples of headhunters, recruiters, and employment agencies that have gone on the record saying 

that they are told not to refer unemployed job candidates. This is 

a real problem. I wish we didn’t need legislation to correct it, but 

it is not self-correcting. 

Second, Congress should pass the Protecting Older Americans 

Against Discrimination Act, which has bipartisan sponsorship of 

Senators Harkin and Grassley, as well as Senator Leahy. The 

measure was introduced in March of this year. It would reverse the 

Supreme Court’s decision in 2009 in Gross versus FDL Financial, 

which upended longstanding and established burdens of proof in 

employment discrimination cases involving mixed motives and held 

that under the Age Discrimination in Employment Act plaintiffs 

must show not only that age was a motivating factor for the employment action, but must essentially disprove any other factor the 

employer may have relied on, whether the plaintiff knows it or not. 

This is a radical decision. It rewrote the law. It disregarded interpretations of Title 7, which is a parallel law, and it has created 

significant mischief. It has created second-class status for ADEA 

plaintiffs. It essentially gives employers a green light to discriminate if they had another reason in addition to age discrimination. 

It creates confusion for trial judges and juries that are hearing 

dual-basis cases involving both age and gender or race discrimination. And it has now been extended to the Americans With Disabilities Act, the Rehab Act, and Title 7 retaliation cases. 

The Protecting Older Americans Against Discrimination Act 

would right this wrong, restore the standards Congress intended. 

In the words of Senator Grassley, ‘‘Older Americans have immense 

value to our society and our economy and they deserve the protections Congress originally intended.’’ 

Our testimony outlines a few other policy solutions that I think 

Congress should consider. I want to end by quoting that bipartisan 

op-ed that you opened with, Senator Kohl: ‘‘What we can’t assume 

is that these problems will correct themselves. For older unemployed workers, their families and their communities and the Nation, the situation will only get worse as we wait.’’ 

As Messrs. Hassett and Baker—and I know them both and they 

are strange bedfellows—wrote, ‘‘Every month of delay is a month 

in which our unemployed friends and neighbors drift further 

away.’’ 

Thank you very much. 

The CHAIRMAN. Thank you very much, Ms. Owens. 

Mr. Carbone, will you tell us about the program that you have 

been operating up in Connecticut with respect to getting older people up to speed and getting them into the workforce? 
11 

Mr. CARBONE. Yes. That’s actually not just for older people. It 

covers long-term unemployed people. It’s called Platform to Employment. What we did, it was basically a research project. We 

wanted to learn more about long-term unemployment, so we looked 

at a two-year study that we had done in-house with our one-stops. 

It was clear to us that long-term unemployed people were facing 

a severe loss of confidence. The emotional issues would certainly inhibit their ability to perform well in the job-seeking side of things. 

We also had to recognize that it was a buyer’s market, that business doesn’t have to consider these people. So we had to make it 

a case in which a program could be offered that would hold business free of any risk. 

So we took 100 people that in microcosm looked like our district. 

In fact, the statistics pretty much mirrored, I think, the national 

statistics. And they engaged in the first five weeks, which was all 

about restoring one’s confidence and getting emotional support 

from specialists during that period, then job search, then going into 

companies where a job was actually open. We would subsidize the 

wages, actually cover the wages, for a period of up to eight weeks 

and they would be on my payroll at WorkPlace, Inc. 

So the businesses were completely free of risk. Business could 

have terminated the contract after one day or after eight weeks 

and not hired the person. We’ve got 71 percent employment as of 

today, in full-time jobs that are private sector jobs. These are all 

people that were two years or longer out of work. They came from 

all employment disciplines, all walks of life. They came from the 

Greenwich side of my region and the Bridgeport side of my region. 

They found life again. 

The CHAIRMAN. Now, this is a program that uses the private sector in terms of funding? 

Mr. CARBONE. Yes. 

The CHAIRMAN. Can we expand the program, should we expand 

the program? Should we attempt to get some public money involved? How important is it that we try and do everything we can? 

Mr. CARBONE. I think you start with the two most essential parts 

of it and you try to establish them in the American workforce system. Dealing with the issue of self-confidence with long-term unemployment must be addressed. There are 3,000 one-stops coast to 

coast in America. That’s where the rubber meets the road, where 

your constituents that are unemployed and our friends that are, 

that’s where they interact with the American workforce system. 

If you’re long-term unemployed, there is very little difference in 

terms of what’s offered for you than if you’re unemployed for three 

days. So I think you take the issue of a program that can restore 

their self-confidence, you include the kind of programs that can 

deal with the emotional issues that will inhibit your ability to be 

successful at this. And you look at the standpoint of business, you 

know, whether or not old tax credits or OJT programs or things of 

that sort still have relevance. I question that. 

So the program worked out very well and, yes, I did it with private money, and by doing it with private money it opened the doors 

to a lot of businesses that if it was government money they would 

have never really let us in. 
12 

The CHAIRMAN. Mr. Jeszeck, we’ve heard about the private sector’s ability to have some impact on this issue. What role does the 

government play? Why hasn’t it been effective in getting more older 

people back to work? 

Mr. JESZECK. Well, Senator, I think the first issue is that, as I 

think the point was made earlier, the economy really needs to create more jobs. That ultimately is going to set the stage for really 

helping a lot of people. 

In our report, we actually were able to identify a large number 

of proposals that could help workers throughout the country. We 

had a panel of experts from all different perspectives. We had 

someone from the Heritage Foundation, American Enterprise Institute. And we had people from the Urban Institute and Wellesley 

College. 

They came up with a lot of different ideas. Each of these has advantages and disadvantages. Some cost significant amounts of 

money. Some maybe less so, but may be less effective. The issue 

of helping just older workers or all workers also was an issue that 

was raised. 

There are a lot of things, a lot of thinking that can be done here 

to identify things that can help workers in the future to obtain reemployment. 

The CHAIRMAN. Thank you. 

Do you want to ask one question? 

Senator CORKER. Sure. I think we have got just a couple minutes 

left on a vote. 

Thank you all for your testimony. It’s all very, very compelling. 

Ms. Whitelaw, especially coming here in your circumstances, I very 

much appreciate it. 

Let me ask you this question. My experience in my previous life 

was the more senior people in a company, it took longer for them 

to find equal employment because those positions in many cases 

are more difficult to find. Is part of the disparity between older 

workers taking a longer period of time to find employment the fact 

that in many cases they would have risen to a much higher level 

as far as the types of positions they held and therefore the length 

of time in finding a job is more difficult? Is that a factor in any 

of the stats that any of you are putting forth? 

Mr. CARBONE. I can tell you more from the standpoint of the experience that we had with Platform to Employment. I think it 

takes a while, it takes a long period of time, for people to come to 

a conclusion that perhaps the level of business responsibility or 

managerial responsibility I had before is not necessarily in reach 

at this moment. It takes a while to think in terms of a platform, 

a way station, a place in which you can get off unemployment and 

onto employment and then have a chance to kind of get your life 

back together again. I think it has more to do with that than it 

does just anything else. 

The CHAIRMAN. I want you to continue. Senator Corker and I 

have to run to a vote. Senator Blumenthal is going to chair the 

hearing. Keep on talking, please. 

Mr. CARBONE. He’s a very good guy. 

The CHAIRMAN. He’s a very good guy. 

Senator BLUMENTHAL [presiding]. Continue, please. 
13 

Mr. CARBONE. Actually, I think I pretty much answered the 

question. 

Senator BLUMENTHAL. I have a few questions for the panel, and 

I want to thank you for being here, particularly Mr. Carbone from 

my State of Connecticut. Thank you for being here. I believe that 

the chairman has described your experience over many years in 

trying to promote what I think everyone on the panel shares as a 

common goal, which is enabling more people to find work. 

I know we do not want to pit one generation against each other. 

I take that point very seriously. But one finding that struck me in 

the GAO report was the disparity between older jobless people in 

terms of education. Normally what I gather the common trend is 

that people with more education tend to have lower unemployment 

rates. Among older Americans the opposite seems to be true. Do 

you have an explanation for that? 

Mr. JESZECK. Senator, one of the things we found, was that if 

you just looked at unemployment rates among older Americans, 

that relationship still held true, that generally more education led 

to lower unemployment. However, once you were unemployed the 

likelihood that you would have long-term joblessness was pretty 

much equal regardless of your level of education; that once you fell 

into that group of being unemployed it cut across racial differences, 

gender differences, education differences. 

It does seem that there’s some other forces at work here. Once 

you fall into that category, it’s either employer perceptions or the 

fear that older workers may cost more because of their higher 

health care costs, or unwillingness to invest in older workers because they might not have enough time at your workplace so you 

can recoup that investment in their training, a number of different 

things. 

But once you fell into that category, it pretty much washed the 

educational differences out. 

Senator BLUMENTHAL. I wonder if you or any of the other members of the panel have reached any conclusions as to which of those 

factors or others are most important in that trend? 

Ms. FURCHTGOTT-ROTH. One important factor, as Senator Corker 

mentioned, is that the more senior the worker—and people in their 

50s are often at the peak earnings of their careers, so there are 

fewer jobs open to them. And as Mr. Carbone said, they have to 

face taking a cut in pay, which can psychologically be very difficult. 

So if you think about a 25-year-old starting out, there are more 

jobs open. So that’s a factor. 

Senator BLUMENTHAL. The smaller number and variety of jobs 

that are open to people who may be in their 50s as compared to 

their 20s. 

Ms. FURCHTGOTT-ROTH. Right. 

Ms. WHITELAW. If I might say something, Senator Blumenthal. 

One of the other things that I have found in my job search which 

is sort of alarming to me is when you go for the interview they look 

at you. If you manage to get even an interview, they look at you 

and they can sort of figure out your age somewhat. And then what 

I’ve encountered is they try to dissuade you in a very clever way 

of not taking the job, by throwing things at you like: You’re going 
14 

to have to carry 50 pounds in a box; is that okay? You have to 

climb ladders, you have to work until 11:00 o’clock at night. 

I found that to be quite rampant actually. So I realized what 

they were trying to do. I mean, at least my feeling was that they 

were trying to dissuade me from even thinking about the job. 

Mr. JESZECK. Senator, if I could also comment on that. In our 

focus groups, which we made clear are not generalizable—we didn’t 

derive any statistical analysis from them, but just at a personal 

level one of the things we found, that for these older workers, particularly when they were employed for long, extended periods of 

time, some of them for two years, they would take any job that was 

available. They had reached points where it didn’t matter what 

they were before in their old company, and some of them had positions that had a lot of responsibility. But at this point they really 

had reached the point that they needed work and would virtually 

do pretty much anything for anyone who would hire them. 

Senator BLUMENTHAL. That’s why I am still somewhat in a quandary as to why—and you put it more precisely and accurately— 

that once someone is unemployed, then the level of education 

seems in effect to work against them, not so much as a purposeful 

disadvantage, but just as a fact of life. 

Is that because maybe those with higher educational levels are 

not willing to take different jobs? Or is it because somehow education is held against them and the employer may feel someone 

with a college education is not going to do well in certain jobs 

motivationally? 

Mr. CARBONE. Actually, I think it was Pew that did a study, and 

when you look at long-term unemployed folks by education the 

numbers are remarkably alike, somewhere 35 percent average. It 

didn’t matter if you had a high school degree or if you had advanced college degrees. 

I think it’s the case of the fall. I think the fall is hurting more 

when you’re in a higher level position. You were probably at the 

peak of your earnings or you were doing very well. It takes longer 

to reach that point. I think it’s less education. It’s less that. It’s not 

that businesses or industries don’t want that. It’s that it takes a 

while for a person to realize that, I’ve got to do something that is 

perhaps not at the same level that I was doing before. I think that 

has a lot to do with the length of the unemployment and how they 

compete for work. 

Senator BLUMENTHAL. Mr. Carbone, you’ve had such extensive 

experience with the longer term unemployed. I wonder if you could 

comment on the evidence, whether it’s anecdotal or more systematic, as to discrimination against the longer term unemployed. 

Mr. CARBONE. It is there. Just look at the want ads, check out 

the Craigslists of the world. There has been nothing more disheartening. I spend a lot of my time interacting with long-term unemployed people. And it’s bad enough when you go to 3 or 400 different places where you apply for work and you don’t get responses, 

but it’s when in earnest you’re looking for employment and you’ll 

see as part of the advertisement: If you’re unemployed, don’t apply. 

Or if you’ve been unemployed a year or longer, don’t apply. 

These folks that issue—I mentioned before about self-confidence. 

Very important. It’s a critical component to getting back on your 
15 

feet. That just adds another level of: You’re done, you’re done. It’s 

there. 

Many companies are overt about it. We’ve seen some companies 

that are icons, that actually put it on their web sites. But a lot of 

other companies in a much more quiet way will practice it, will 

practice it. And I worry more about them than I do the ones that 

put it on the web site, because I think there’s a lot more of them 

out there that do that. 

Senator BLUMENTHAL. You may know that I have introduced a 

bill called the Fair Employment Opportunity Act of 2011, that 

would prohibit that kind of—— 

Mr. CARBONE. I do. 

Senator BLUMENTHAL [continuing]. Discrimination. But of course, 

the sort of implicit or implied discrimination, maybe not stated, not 

overt, is as troubling as the ads you’ve just described. And I’m not 

sure how we get at that kind of discrimination. 

Mr. CARBONE. I’m not sure that you can. I think what brought 

this to the surface as far as I was concerned was the added discouragement that it had the effect on long-term unemployed people 

when they would see it in print. In terms of how internally it’s 

used by a business, I think it would be very difficult to kind of legislate some way to prohibit that. 

Senator BLUMENTHAL. In a way the irony is that your program, 

The WorkPlace, and others like it do such fantastic work in providing the orientation, the attitude, the skills that are necessary for 

longer term unemployed to reach the point where they really sustain their motivation and their drive, and yet there is the discrimination against them, which in turn adds to their frustration and 

makes your job all the more different. 

Mr. CARBONE. Yes, and it adds this new dimension to our job. 15 

years ago when I came to The WorkPlace, if somebody said, ‘‘what’s 

long-term unemployment,’’ I would have said 39 weeks. And now 

it’s 99 weeks in Connecticut. It’s kind of tapering down. It won’t 

be for long, but it was. 

And that changes the way we do our business. So we kind of 

spent two years as unemployment was surging, preparing the onestops for this huge increase in the number of participants as the 

unemployment rate was rising. But while that was happening, it 

was sort of—kind of almost a silent feature, because I will tell you, 

and I take a lot of guilt on this, I didn’t even notice it until it became a crisis, where one day the acting commissioner of labor sent 

a letter out saying: On May 15, 12,000 people in Connecticut are 

going to reach this 99-week of benefit point, be unemployed, and 

no further benefits. 

So you could imagine that you go that period of time and all of 

a sudden not only don’t you have a check coming in, but you don’t 

have a job. There are issues that are facing you that the American 

workforce system never had to address before, and frankly is not 

prepared to address, not prepared. 

It’s not Platform to Employment per se in 50 States everywhere. 

It’s the elements of the program that proved to be essential to enabling long-term unemployed people to gain employment. Putting 

those elements in the American workforce system is what this is 
16 

all about. It doesn’t take a lot. It doesn’t cost a lot. But it’s a way 

of connecting this population. 

When I said before that we’re losing the battle, more and more 

of them are lost every single week. And once they’re lost, once they 

start that march to the safety net, they’re done, they’re done. 

So it’s looking back at the American workforce system and seeing 

what’s not there that needs to be there. 

By the way, Senator, we do it for other groups and we should. 

We do it for veterans, we do it for dislocated workers, we do it for 

people with disabilities, and we should. This is a special population 

whose numbers eclipse all other special populations in our system 

already, and growing every day, and we’re not addressing it. We’re 

basically telling them to walk the plank and get lost. 

Senator BLUMENTHAL. I wonder if I could just conclude by asking 

any of the witnesses whether from your knowledge of the history 

of unemployment and economic trends in the United States, whether this kind of longer term unemployment in the numbers and the 

structural effects and qualities is unprecedented or whether you 

can look back and see times in our history when it has happened 

similarly? 

Ms. FURCHTGOTT-ROTH. We’re at an almost record high in terms 

of the share of the unemployed that is long-term. We were at I 

think a record high last year something like last year. It’s gone 

down slightly. That’s why we really need to focus on economic 

growth to get rid of this problem. 

If you look at North Dakota, for example, it has the lowest unemployment rate in the Nation. Unemployment is 3 percent. It’s taking advantage of oil and natural gas exploration. And there are 

other States, other parts of the country that want to do that, but 

are impeded by regulation. We can almost call the United States 

‘‘Saudi America’’ in terms of the percent of oil that we have that’s 

going to come on line in the next 20 or 30 years, and we need to 

take advantage of this new American energy revolution to be putting people back to work. 

You can’t get a motel room in North Dakota. The same with 

Eagle Ford south of San Antonio in Texas. We need to be encouraging these other kinds of policies to reduce long-term unemployment as well as short-term unemployment. 

Senator BLUMENTHAL. I wish we had the oil and gas in Connecticut that North Dakota has. So we are actually relying on different kinds of energy to generate employment, fuel cells and alternative sources of energy, which may not be subject to that kind of 

regulation, but are equally important to the energy future of the 

country, I think. But thank you for that comment. 

I’d like to thank all of you for being here today. I have to go vote 

again. I apologize that your testimony has coincided with a series 

of votes that we have ongoing and that’s probably the reason why 

we don’t have more Senators here and why we are going to adjourn 

now. But I really do appreciate your testimony today. 

The record will be kept open for a week—ten days. With that, 

this hearing is adjourned. Thank you. 

[Whereupon, at 3:12 p.m., the hearing was adjourned.] 
(17) 

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