Sun, Jul 05, 2009
Employee Louis Via, left, helps longtime Tucson glass artist Tom Philabaum work on a piece for an upcoming show in Scottsdale. Due to the economic downturn, Philabaum has been forced to lay off some of his staff.
greg bryan / Arizona Daily Star
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Business

Paychecks shrinking

Tucsonans face pay cuts and reduced hours

By Dan Sorenson
Arizona Daily Star
Tucson, Arizona | Published: 01.04.2009
There's a hidden side of the economic downturn that is hurting some Tucsonans but isn't told by the monthly unemployment numbers.
Cuts in hours worked, reduced wages and lost benefits are biting into workers' standard of living in a less-visible way than layoffs.
Even what were recently called recession-proof jobs — "people are always going to need medical care and insurance" — aren't always spared.
Certified nursing assistant Tina Harbin was drawn to Tucson from Ohio last year by the shortage of patient-care professionals here, but the boom went bust just weeks after she arrived. Now she's looking for another job to take up the slack from having her hours cut.
"I expected to come out here and work myself to death," Harbin said.
Juanita Ryan is 73, but the certified insurance saleswoman said this is no time to retire. Ryan said her hours have been cut from 40 to 16 per week.
She understands — business is down. Other people are hurting, too. And those people aren't buying new cars and houses, so they're not buying new insurance policies.
Local employers are using almost every possible combination of cost cutting, often to avoid layoffs, said David Joe, a work-force development specialist at Pima County's One Stop employment center. They're cutting hours, lowering wages, increasing employees' benefit costs and reducing previously dependable overtime hours.
Workers usually don't turn up in Joe's office until they've been laid off, and there's no regular statistic — like the monthly new unemployment figures — to track these cuts. So, he said, there's no timely way to show how many workers have been hurt by other cuts or to quantify the economic loss.
But there seem to be more of these kinds of cuts than in other recent recessions, said University of Arizona associate professor of economics James McBrearty, a labor-relations expert.
"In the past, many employers were much more quick to just lay people off. Now they seem to be saying, 'Let's see if we can figure some other ways to spread the misery around,' " McBrearty said.
Christopher Clark: 2 jobs
Clark is working two jobs to make one living.
"I saw it coming," said Clark, a wildlife specialist with Animal Experts, a small local company that removes or chases away nuisance wildlife.
Clark said he does everything from trap and relocate raccoons and ringtails that have moved in on humans' homes to pulling skunks out of engine compartments, getting rid of bees and trapping bobcats and dangerous dogs.
He was 40 feet up a ladder outside the county's One Stop Employment Center last week setting humane traps for woodpeckers who'd been pecking holes in the building's north wall. But he said that kind of work, especially residential calls, has been down recently.
"If someone has an animal problem and it's going to cost $120, and they (also) need food . . . ," Clark said he knows it's his services that will go begging.
He said that he owed the Internal Revenue Service some money three years ago and took what was then a side job as a room-service bartender at a resort to help pay off the bill.
He kept the hotel job, paid down his mortgage and got in the habit of eating at home.
Clark insists he was "lucky" more than "thinking ahead."
But he now puts in 30 hours a week at the resort job and about 25 hours for Animal Experts.
Tina Harbin, nursing assistant
"Boy, have I been hacked to death since I moved here," said Harbin, the certified nursing assistant who moved here from Ohio in September. "A month later they cut staffing. I found a wonderful job, and in three months they've darned near taken everything away from me," said Harbin, 45.
Harbin, who works at a Green Valley rehabilitation and nursing home, said her hours per two-week pay period were first cut from 80 down to 75 and, last week, to 70.
She lives in Tucson and was getting $8 travel pay per shift — paid to workers commuting from outside Green Valley — until that was recently dropped.
Harbin said she's not making enough money to meet her monthly expenses, in part because of the money spent to move here for what she was told was a nursing and health-care worker shortage.
She's also at financial risk because she's working without insurance. "I opted not to take the benefits because the benefits are too expensive," Harbin said.
"I keep my eye on the computer and the newspaper," Harbin said. "I pray there's a job out there."
Help available
People who have experienced reductions in hourly pay and hours or loss of benefits are eligible for the county's services, said Murney Brown, a county work-force development information specialist.
She said it's a myth that you can't claim unemployment insurance if you quit your job. One Stop job counselors tell clients to apply for unemployment insurance even if they had to quit a job because of drastic pay or hour cuts.
"The burden of proof is on the employer," Brown said.
But a state unemployment official said workers who quit, even if they quit because they aren't getting enough money to live on after their hours or wages have been cut, have virtually no chance of getting unemployment payments.
"There are limited circumstances where individuals quit their jobs and still qualify — such as health reasons, documented cases of domestic violence," said Liz Barker Alvarez, spokeswoman for the Arizona Department of Economic Security.
"In the vast majority of cases, people who quit their jobs because of reduced hours or wages do not qualify for unemployment insurance benefits," she said.
Historically, employers reduce hours rather than lay off workers early in a recession, according to Tony Nunes, an economist in the Bureau of Labor Statistics' Western Region office in San Francisco.
"Conversely, when we start coming out of economic decline, instead of rehiring, they tend to increase hours of existing workers," Nunes says.
The bureau's next quarterly census of employment and wages should show the reduction in hours and wages some workers are experiencing, he said.
McBrearty, the UA professor, said he thinks we will eventually have an idea of how much money people are losing through reduced hours and similar cuts, even though the employees won't be counted as unemployed. The Bureau of Economic Analysis also regularly measures personal income.
"When the income figures come out, it's going to tip off the Labor Department," McBrearty said. Then, he believes, federal officials will ask, "What can we do to shore them up?'"
Marianne Marts, real estate
Marts said a downturn in the commercial real estate business has had a direct effect on her.
She works as an executive assistant for two local commercial real estate firms that share her services. Until recently, she was working 35 hours a week.
"We do new development," Marts said. "So, the financial business hits us. People can't get a loan; they can't start a business."
She said her employers told her in early November that her hours would probably be cut.
"They just called me in and said we need to talk about potential things that may happen with reducing hours. They gave me some options, let me go talk to my husband. They originally offered 20 hours," Marts said.
She says she told them she needed 24 hours a week and they agreed.
Marts said she appreciates that her employers gave her a warning and worked with her to come up with a solution that worked for them and her.
Still, Marts said she knows the business well enough to know her job may not be there, even at reduced hours.
"I'm looking at taking a class in medical coding, billing," Marts says. "People always go to the hospital."
Juanita Ryan, insurance
Ryan, a licensed insurance service and salesperson, said the agency where she works cut her hours from 40 per week down to 16 in November.
"People aren't buying new cars and houses like they used to," she said.
Ryan, 73, said she still wants to work, but that insurance is "the only thing I know. I've worked in insurance since I was just out of high school."
She's been looking for additional work but hasn't found anything yet.
"This came up in November, and it ruined my Christmas," Ryan said.
Working in insurance, she's seen how the economic downturn has affected a lot of other people, too — including some who have jobs and haven't had their hours cut.
"There's going to be a lot of people in this city without insurance on their car. The economy is causing it," Ryan said.
On StarNet: Tell us if your work hours or benefits have changed because of the economy and how you're coping. Go to the online version of this story at azstarnet.com and click on reader comments.
● Contact reporter Dan Sorenson at 573-4185 or dsorenson@azstarnet.com.