Where layoffs hit hardest is hard to gauge

Every day there's another layoff announcement, so Sean O'Grady finds himself confused about why his Philadelphia-based recruiting company, CareerTV USA Inc., is doing so well.

"We had to shake our heads at that," he said, "because we're doing our best sales ever, and we had our best quarter at the end of 2008."

So O'Grady started asking his clients to explain why they are bothering to recruit in these times, even when, in some cases, they are cutting back on hiring.

What he learned and what he is seeing "is the layoff of the baby-boom generation. Companies are filling those holes with bright-eyed, bushy-tailed college graduates.

"They are essentially trying to hire people they can pay less and get a lot of energy and enthusiasm," said O'Grady, 26, a senior producer at CareerTV.

CareerTV's clients are companies that want to recruit recent college graduates.

They hire CareerTV to make company recruitment videos aimed at the college-graduate demographic. CareerTV is a subsidiary of Universum Inc., a Swedish-based international marketing company with its U.S. headquarters in Philadelphia and a focus on college graduates.

CareerTV also produces a monthly half-hour television show distributed to career centers on 400 campuses. The show adopts a blithe tone, with features on companies and on occupations. One recent report: How to be a ski instructor.

"There is so much pressure on these students to get a job and pay off college loans that they are going to jump at these opportunities," O'Grady said. "The victims are those who are 15 to 25 years deep into their companies and have become too expensive."

The truth of O'Grady's assessment is hard to pinpoint.

On Friday, the Labor Department reported that the nation's economy shed 651,000 jobs in February, boosting the unemployment rate to 8.1 percent.

Looking strictly at age, teenagers 16 to 19 in the job market are faring the worst, with unemployment at 21.6 percent. Baby boomers actually have the lowest unemployment rate at 5.6 percent.

The unemployment rate for workers between the ages of 20 to 24, including college graduates, is 12.9 percent.

Prospects for this group are not good, reported the National Association of Colleges and Employers. On Wednesday, the Bethlehem-based group said its survey showed that employers planned to hire 22 percent fewer college graduates this year than in 2008.

"More than two-thirds of employers said the economic situation forced them to reevaluate their college-hiring plans, and nearly all of those said they have decreased their planned number of hires," said Marilyn Mackes, the association's director.

That's the statistical story.

But at Thursday's CareerBuilders.com career fair in the Philadelphia Marriott, it looked different.

Most of the 1,800 job seekers jammed into the Center City hotel's ballroom appeared to be older than 40.

Most were old enough to have had at least 10 years' experience in their fields, according to Ian Barbo, the CareerBuilder staffer in charge of the fair. A year ago, he said, about 40 percent of the attendees had a decade of experience. This time, he said, 50 percent to 60 percent said in questionnaires that they had a decade of experience.

One was Andrew Vavra, 55, of Schwenksville, an unemployed marketing project manager. He had been to a another job fair recently "and no one under 40 was there," he said. "It made me angry.

"They are laying off older workers to reduce their pension exposure and their health-plan exposure," he said. "The young people are being hired in without medical plans and pension plans."

What is clear, said economist Joel Naroff, is that companies are using the recession to reconfigure their workforces - and that is what they should do.

"There is a popular phrase - 'don't waste a perfectly good crisis'," said Naroff, chief economist with TD Bank N.A. "The idea behind that is you can do things you couldn't do under a normal set of circumstances. You have the opportunity to make the changes that you really should have made before."

Companies that cut jobs just to shave expenses will not be prepared when the economy rebounds. The cuts should be strategic to position the companies for the future, said Naroff, of Holland, Bucks County.

If companies are going to announce layoffs of 5,000, he said, it does not give them much more of a publicity problem if they say they will lay off 5,500, with the idea of getting rid of "dead wood" or entire unproductive divisions. "It looks the same to the public."

"Now they've been given free hand to do it," Naroff said. In a sense, "the economy gives them cover."