
The American Way of Hiring Is Making Long-Term Unemployment Worse - pmiller2
http://blogs.hbr.org/2013/12/the-american-way-of-hiring-is-making-long-term-unemployment-worse/
======
smtddr
I think at one point in America's history, Long-Term-Unemployment(LTU) was a
semi-decent indicator of a possible problem-employee because nobody was
questioning "Is college worth it?". Back then, you were pretty assured that
your degree(whatever it was) guaranteed you a job... so if you didn't have a
job for a long time, then either you're a lady who became a mom or you're a
man who messed up in life. But today, especially after 2008/9 real-estate
mess, a bunch of totally legit people fell into LTU by no fault of their
own... but the stigma still remains.

I also think this is more a problem for non-tech jobs. In today's world, if a
software-engineer wanted to travel the world for 8 months I suspect she could
easily get a job when she's done. She'd probably be getting recruiter-calls
_while_ on vacation.

~~~
redschell
I don't know. I can't tell if the phenomenon of ageism in tech is under or
overrated, but I do think that techies have the advantage of never truly being
out of work, so long as they're hacking away at something.

In fact, older LTU workers could learn from the tech strategy of consulting
and freelancing when "gaps" in their careers emerge. So long as you have
something to show for it, such as a new skill or someone in your network that
can raise their hand and say, "Oh yeah, she mentored me through this big
project my company is working on" then you can help yourself out a bit.

I want to know how much of this is HR's fault. What the hell are they looking
for, and why? Everyone admits this is a problem, but HR goes on as if they're
oblivious to it. And then you read about how they're dismissing candidates
that don't have an adequate social media presence, and you begin to wonder why
on earth these goons run hiring.

~~~
michaelochurch
_I can 't tell if the phenomenon of ageism in tech is under or overrated_

It's bad in VC-istan but I don't think it's bad in technology as a whole.
There are plenty of 50+ programmers at places like Google who are well-
regarded.

The fear that many of us who are in our 20s and 30s is that the culture of age
discrimination-- one that we, although young, really don't support, but that
is inflicted upon us by the VCs-- will get worse in the next decade or two.
Right now, it's not apocalyptic and most good programmers will be fine. The
concern is that if VC-istan becomes the new normal in employment, ageism will
be more of a problem when we get to 40+. Right now there are still a lot of
good jobs for 40+ programmers at the Staff+ SWE level at places like Google
and Amazon, but that won't be true if VCs acquire more power.

 _Everyone admits this is a problem, but HR goes on as if they 're oblivious
to it. And then you read about how they're dismissing candidates that don't
have an adequate social media presence, and you begin to wonder why on earth
these goons run hiring._

HR looks for reasons to reject people. They have to, because they get so many
junk resumes. They cut for too old or too young or too long at the last job or
too short at the last job. You need, whenever possible, to engage with people
who are looking for reasons to _accept_ people.

~~~
memracom
In other words if your career is in any way unusual, the HR folks don't want
to let you in. They have no way to judge a resume by objective standards
because they haven't got a clue about the work being done in their company. So
they rely on hiring people who conform to some fantasy of what a modern
company employee should be like.

~~~
RougeFemme
In my experience, the hiring managers have been the problem, not HR. I've been
very frustrated by my managers' attitudes and expectations when trying to hire
folks for my team. They've rejected resumes against my recommendations. And
after interviews, they've declined to offer jobs to people that I thought
would be great fits. And then they continue to complain to _their_ managers
that we _just aren 't getting quality candidates_. Not true!!! And again, this
is not HR. . .these are the hiring managers.

------
brownbat
Any discussion of "overqualification" should begin with this chart:
[http://www.bls.gov/emp/ep_chart_001.htm](http://www.bls.gov/emp/ep_chart_001.htm)

We often worry that acquiring human capital is a double edged sword, but it's
hard to find that in the data.

That said, BLS has written that older workers face both lower rates and longer
durations of unemployment:
[http://www.bls.gov/opub/ils/summary_10_04/older_workers.htm](http://www.bls.gov/opub/ils/summary_10_04/older_workers.htm)

It seems contradictory at first glance: how do older workers have better and
worse luck at the same time?

One way to explain this is that as older workers gain in specialized skills,
it makes "search costs" more difficult, it's harder to match them to the right
job. PhD's in narrow disciplines face a similar situation: it's much harder to
find that good fit right out of school, but in the long run, once you find a
place, you're more likely to be well compensated, poached, or retained in
employment by those who understand your skill set for the rest of your life.

There could be other explanations. But from the raw data, if you had to bet on
someone being employed, try to pick someone who is highly educated and older,
no question.

~~~
toomuchtodo
So, not only is college "useless" now, so is having experience. As 31 year old
DevOps making $low_six_figures, this is somewhat worrying re: future
prospects.

Even adapting is no assurance of your future employability.

------
mark_l_watson
This story resonates with me because while I have had an active consulting
business for about 15 years (and right now I have a consulting gig at Google),
twice in the last five years potential customers wanted to hire me for
projects but they were blocked by their HR departments who thought I was LTU.
Offering to show tax records did not help.

I am also in my 60s, so I also feel for people who might suffer from age
discrimination (or gender, race, religion, etc.)

There should be a level playing field, but sadly that is not always the case.

~~~
qwerta
But that is horrible. Just to rephrase:

> twice in the last five years potential customers wanted to hire me for
> projects but they were blocked by their HR departments who thought I was
> black. Offering to show birth certificate of my father did not helped.

~~~
All-Delib-Speed
While I can appreciate the point you're trying to make. Please don't think not
hiring someone because they're black, and not hiring someone because they've
been, or appear to have been, unemployed for a long period of time are the
same thing.

There is no ethical, legal, and legitimate reason to not hire someone for a
consulting job because they're black. There is an ethical, legal, and
legitimate reason to not hire someone because they have been unemployed for a
long period of time. Or to at least consider other candidates who don't appear
to have been unemployed for a long period of time.

I'm hoping your comment about showing a parent's birth certificate was solely
an attempt at an analogy and not meant to be something you think realistically
would or does happen. An employer can't deny a candidate employment because a
candidate is or isn't black, or their parents are or aren't black. That's the
point. Race and color are both protected classes in the US [1]. A person's
long term unemployment, just like their level of education and attractiveness,
isn't a protected class. Meaning a job can discriminate against a person all
day every day based on their history of long term unemployment.

And just to add, the birth certificate of one parent doesn't determine a
person's race as far as society is broadly concerned, particularly if you're
considered black in the US [2][3][4].

[1] - [http://www.eeoc.gov/laws/types/](http://www.eeoc.gov/laws/types/) [2] -
The President of the United States [3] -
[http://news.harvard.edu/gazette/story/2010/12/%E2%80%98one-d...](http://news.harvard.edu/gazette/story/2010/12/%E2%80%98one-
drop-rule%E2%80%99-persists/) [4] -
[http://www.pbs.org/wgbh/pages/frontline/shows/jefferson/mixe...](http://www.pbs.org/wgbh/pages/frontline/shows/jefferson/mixed/onedrop.html)

------
001sky
Not so much a comment on the thesis, but the actual "research" is missing and
it would improve the essay if it was actually _presented_. Even in a synopsis.
Its a shame, as the The only link is to the "forthcoming book" on Amazon.

 _My research, involving in-depth conversations with hundreds of unemployed
job seekers, indicates that no group of workers is more committed to
contributing to a company that gives them a chance to prove their value than
older workers who have been long-term unemployed.

Importantly, while some employers fear that older workers will not sticking
around, my research suggests the opposite is more likely. It’s worth
considering whether, in fact, it is younger workers in their 20s and 30s who
are more likely to be actively searching for opportunities to move across jobs
in an effort to develop a portfolio of marketable skills and experiences.
Older workers are really looking for a company where their considerable skills
and experiences are valued and can make a difference._

One concern tha jumps out (i'm sure to many) is the reference to a measurement
of "future comittment", which seems at best unpredictable. Take, for example
the divorce rate amongst newlyweds. His methodology may indeed be wide-
rangingly useful (assuming its good), but we don't get a sense of it here. It
does seem, in any event, that the HR heuristics at BigCos these days are
apparently shallow.

------
quantumhobbit
It stands to reason that if the bias against long term unemployed workers is
strong enough there will exist a surplus of highly qualified workers who have
been out of work for 6 months or more. Everything else being equal, the long
term unemployed could be hired at lower than market wages for their skill
level. A smart company could pick up qualified workers pretty cheaply by
ignoring unemployment length right now.

~~~
sokoloff
I'm far more interested in the VALUE of a prospective employee than I am in
the COST.

I expect a technical employee (myself included) to bring to the company some
multiple of their salary each year. With that in mind, I'm far more interested
in the possible upside of a good employee than in reducing a portion of the
costs of a possibly cheaper employee. (I'm generally "on the hook" for some
amount of constant costs: 401-k match, insurance, building occupancy costs,
free food/drinks, management attention/overhead needed, etc, so a 25% lower
salary might only net me a 15% lower overall cost.)

Long term unemployed, excessive job hopping without good explanation, long
stints of employment without promotion or other evidence of growth are all red
flags. They're not fatal in isolation, but believe me, they get scrutiny by
hiring managers who are paying attention.

Someone involuntarily out of work in a tech field for 6 months is likely to,
at a minimum, interview poorly. (Otherwise, they'd likely land somewhere
inside of 2 months.) For your plan to work, one has to be willing to low-ball
a candidate who likely just interviewed poorly with you. I don't think the
risk-reward works out, which is why I'm probably part of the problem, but
willingly so.

Candidates that interview poorly get a polite rejection, not a lowball offer.

~~~
Daniel_Newby
But you are not competing against competitors who might steal them away for
-24%. You are competing against Walmart: -75% salary, -100% fringe benefits.

~~~
sokoloff
Still misses the value side, but even on the cost side, that's just a recipe
for getting someone back in the workforce for 18 months until they re-
establish their credibility and confidence and jump ship to another firm for
what will be a 300% raise for them. I wouldn't blame them in the least; they'd
be an idiot to keep working for me under those circumstances.

Hugely helpful for the employee, but an "adequate, not spectacular" employee
who works for me for 18 months isn't helping my company much overall. The
first 6 months is straight negative; the next 6 is break even, and the next 6
pay back the hole we dug in the first 6. So, good for them and hopefully break
even for me, except I lost 18 months of "tempo" with one of my employee spots.

For a cash-strapped company, this plan might make more sense. For a profitable
and growing later-stage company, I think this makes much less sense. (I work a
much later stage company, so that surely colors my opinion and biases here.)

------
memracom
In my experience this is not just a problem with older workers and with long
term unemployed, but also a problem with immigrant workers. There is a lot of
experience out there that could be a productive part of the economy if only
hiring managers would give their head a shake and break out of the ritualistic
processing of resumes.

More creativity is called for. For instance, are you snowed under by 300
resumes for only one position? Maybe you need to rethink how you describe your
requirements. Read every 10th resume and then rewrite your requirements.
Winnow down the resumes to a semi-short list based on one or two key things.
For instance in software development look at the type of projects they did.
What did they deliver regardless of the technology that they used. You will
probably still have 100 resumes. Then send your new requirements to each of
these people by email, give them 24 hours to reply with a two page letter
explaining how they can help you achieve what you have described in your new
requirements. Probably most of them either won't reply in time, or their
letters will be godawful things that you can't even read to the end.

But you will find a few gems to interview.

To do this right your new requirements need to focus on describing the
problems that you face and the timeline in which you want to solve those
problems. Ask people explicitly to question your current approach. Maybe that
guy with no PHP experience actually does have something to offer to your all-
PHP shop.

Or do something else. Just do it creatively, think out of the box, and try to
make it interesting for the applicants as well.

------
jroseattle
I just went through a (long for me) job search. As someone who has typically
been able to have another job within days, this time it took me roughly three
months. It was exhausting and frustrating, but also very eye-opening. I found
a pattern among companies that gave me great insight, and from that I could
choose a course of action.

I found two different companies trying to hire -- those looking to fill
positions, and those looking to solve problems. Huge difference between those
two; the former is tactical, the latter is strategic. Everyone needs to strive
to find the latter.

I found interviews with those looking to "fill a position" bordered on the
absurd in terms of their hiring approach. It throws you (the job seeker) off
your game and makes you question your own competency. Don't fall for it; keep
looking for those companies that are trying to solve problems.

~~~
crazygringo
Can you elaborate? Every company I've ever encountered is looking to fill a
position because it has a problem to be solved that needs someone in that
position to help solve it -- they can't develop their new product without
three new programmers, for instance. Strategy is executed via tactics, they're
not mutually exclusive.

Could you give some more concrete examples, or something? Are you talking
about ongoing maintenance jobs (like your time will be spent mostly bugfixing)
vs building-new-product jobs? I'm really curious what you mean.

~~~
jroseattle
Don't take that in the literal sense -- of course, anyone who is hiring
someone is technically filling a position. Think of this as a classification
of a company's motivation to hire in the first place.

I found companies that were "filling positions" were those that had a previous
role defined, and now needed to either replace the previous owner, or add to
the organization (they had budgeted for it, for example.) These tended to be
larger companies, and the focus for the job was the role. In these cases, the
role had largely been pre-defined.

The short-list of companies I spoke with that were trying to "solve a problem"
didn't think about what role someone should fill, but rather what capabilities
a candidate could bring to their team. These companies I found were often
smaller (less than 100 employees), although I'm sure it could apply to larger
ones. The difference with these companies is that their focus (from my vantage
point) was not on organizational structure, but rather on thinking about how a
candidate could augment their team.

It was very eye-opening, and once I picked up on that pattern, I began to ask
the "right" questions.

------
infra178
Pass a law exempting businesses and individuals from paying payroll taxes on
new hires for the length of time the person was unemployed before they hired
them.

------
jeynepoole
This almost seems like an unfortunate consequence on the "Innovator's
Dilemma", whereby older workers compete on experience and qualifications, but
are then deemed overqualified by employers. Much like how technology
consistently outpaces market demand.

Rather, it seems like workers need to compete on a new trajectory and perhaps
be re-educated. Although, I don't know if how system supports that very well.

------
morgante
One thing I don't understand about long-term unemployment is why you wouldn't
immediately start freelancing if you couldn't find a job. Start a company,
take occasional contracts, and list that on your resume. Boom, no employment
gap.

Can someone explain why people don't just do that instead of complaining about
"discrimination?" Heck, I myself would never hire someone who had been
unemployed for a year and lacked the ability to either get a job or start
their own thing.

~~~
ryandrake
Well, it's not as if one can just snap one's fingers and line up a freelancing
gig. The reason people don't "immediately start freelancing" is the same as
the reason they don't immediately just go out and get a job.

~~~
morgante
Maybe I wasn't clear. This doesn't have to be a _real_ company in the sense
that it actually generates profit.

All you need to do is file for DBA and start accepting really low-paid gigs
off a site like elancer. And yes, you can literally just snap your fingers to
get those.

The point is you're not starting the company to actually succeed. You're just
starting it to list something besides unemployment on your resume and hence
get a real job.

~~~
mgkimsal
I get your point, but it really isn't as easy as that.

"All you need to do is file for DBA and start accepting really low-paid gigs
off a site like elancer."

If you're going to bother to be on elance/odesk/etc, you'll have a public
profile. To get any decent work there, you'll have to have a _good_ public
profile, which can be tarnished by any one of the people you work for making
extremely outlandish and ever-changing demands, with the threat of a 'bad
review' hanging over your head.

Furthermore, there are always dozens (at least) people vying for the $100 gigs
- you can't just 'snap your fingers' and get one (or several). And again, even
if you could get one, it's not really the sort of work you want to do (in many
cases).

Your point about labeling yourself an independent contractor is, in itself,
not bad, but it's partially just a smoke screen - doesn't really help pay the
bills on day 1.

And even more to the point, there are a number of companies that _won 't_ hire
people who've been freelance/contract for any period of time - they see it as
the person being too willing to be 'disloyal' or 'job hop away' at a moment's
notice.

Labelling yourself as a contractor or independent business during unemployment
period is definitely one way to explain a long gap, but it's not a silver
bullet.

~~~
johnjlocke
People have a different perspective on life when they are 20 years old as
opposed to 30, 40, or 50. Elance is definitely not a way to make a living or
be taken seriously by a potential employer.

------
joshuaheard
I looked at the data supporting the article's assumption that older workers
make up a greater percentage of the long term unemployed than exist in the
marketplace, and it is just no that great of a difference.

Instead of blaming employers, there are other causes for long term
unemployment. The first of course is a slow growing economy that would
normally absorb the unemployed. The other, I believe, is the greatest cause of
our long term unemployment: raising the federal minimum wage $2 back in 2008.

Without going into detail, creating an artificial floor for the price of
something limits the supply. For example, Some employers won't hire someone at
$7 an hour, but might at $6. Some employers could hire 5 employees at $5 an
hour, but only 4 at $7.

~~~
mratzloff
Compete for starvation wages, ye masses!

------
6d0debc071
If I may be forgiven for wool-gathering for a moment:

Many positions have quite limited returns on the right tail, that are easily
reached by people of no special intelligence. If you're a Mickey D worker, it
doesn't matter how smart you are. If you're a clerical worker, again, doesn't
matter much. Almost anything that falls under admin, doesn't matter very much.
Sales? Well, there's a certain charisma required but certainly working in most
of sales doesn't require much intelligence - I know, I've done sales myself
before and written procedures for it. Once computer speech is reliable I
expect a lot of sales people to become unemployed outside of B2B.

Being a manager? Well, if you're in a technical firm there's a fair amount of
person experience required there, but it's not hugely challenging - it's more
a matter of decency and common sense. (And honestly, my faith in companies
being able to reliably select for managers is 'HAHAHAHA, no.')

And the dreadful thing here is that the better you are at a skill, the harder
it is for people who don't share that skill to recognise it. So unless the
company's hiring procedure is geared towards finding it, i.e. they live to
find the right tail, that will likely go unrecognised. The search costs
increase the more skilled you become. Hence why so many crap programming jobs
are advertised as 'X years experience' ; the person doing the hiring is an HR
girl who doesn't know how to recognise the real deal and probably doesn't
really have the time anyway.

If you're doing most any job that doesn't qualify as intellectually
challenging, it doesn't matter much how smart you are to the company, they'll
not profit by your intelligence. If you're doing any job where ability is
poorly assessed, (which kinda screws you if the person interviewing doesn't
know the job themselves,) it doesn't matter how smart you are - they'll not
ask the right questions to find out.

#

If you want to look at how people end up LTU, I think you have to stop
thinking about them as people; with hopes, dreams, and virtues. (Yes, that
does make me feel sick.) That's not what they look like when you're looking at
their CVs.

Think of them almost like you're picking horses in a race: Someone tells you a
horse has been out of racing for a long time. Do you gamble on it?

If it was a truly exceptional horse, maybe you do. But the average unemployed
person is going to be average at best. Given you can't expect them to be any
better than the employed person, do you gamble on them?

Of course you don't. The horse might have been out of the game for a number of
reasons. But how many of those reasons are good - and what's your gain over
gambling on a horse that hasn't been out for a while? If you had more
information about it than the market then you might - but your expected value
of information for most jobs is going to be low due to the lack of recognised
ability to leverage their intelligence in most roles.

If you're LTU, without some form of background check, that's indistinguishable
from having been in prison, or having a mental breakdown, or getting sacked
for a reason. What were they doing for the last six months? You don't know,
but there's a higher than average chance of it being something bad.

When you have multiple candidates to choose from, and you can't easily
distinguish quality given your initial investment in them, and your EVI is
lower than the cost of that information, it makes sense to be risk averse on
easily seen indicators. Maybe you're missing great candidates, but for most
positions, what's your motivation to care?

When they're competing with people who aren't LTU, and who can do the job
about as well, the company's expected return on investing in them - spending
the time and money to check these things - seems likely to be _negative_
outside of companies that can leverage exceptional individuals.

------
jgalt212
Fair enough, but the European way of firing (or lack thereof) leads to
persistent underemployment. And tons of "off the books" labor. The most
recently reported unemployment rate in Spain is 26.7%. Do you think a young
democracy (they had a dictatorship almost into the 1980's) could actually
handle a real unemployment rate that high with fomenting a revolution?

------
michaelochurch
The problem older workers face is simpler. They don't fit in to the
hierarchical corporate environment, which is yet another reason why that mode
of organization is outdated.

If you're old and good, the supposition is that you'll resent being told what
to do by someone inexperienced and probably not as skilled. If you're old and
bad, then you're not a desirable hire anyway. Catch-22.

The way to fix this is to move to organizational models that don't rely so
heavily on subordination and hierarchical rigidity. Conceptual hierarchy is
necessary, but a fixed hierarchy of people is not.

Also, I think the VCs are to blame. They pick founders who are very young,
because they're easier to take advantage of. Since it's rare that a capable
50-year-old will happily work for a 25-year-old founder, and the "boss should
be older" rule traverses the hierarchy, the accepted age band at every rank
becomes younger and more narrow.

~~~
johnjlocke
I think that hiring decisions that work against older workers are based on a
lot of unsubstantiated presumptions.

There's no reason to resent someone being your boss if they happen to be
younger. If they are a good leader, that has nothing to do with their age
differential.

I do agree that VCs have a lot to do with youth bias in startup culture, and
for the reasons mentioned. It is easier to get a younger person with no
external obligations to work insane hours. Why else would Facebook and Google
build campuses that employees never have to leave?

I don't believe in homogenization of demographics, age and experience over the
long haul. It leads to stagnation of perspective and ideas, because the
experiences of the teams are so similar.

I think that people can learn from each other, both directions, and that is
good for a team that has the bravery to challenge the status quo.

------
iterative
The problem isn't with the American way of hiring, it's with the American way
of voting.

------
tsotha
>One set of stereotypes is directly about the purported effects of age. For
example, that older workers are less energetic or less able to use new
technologies.

The problem is there is a lot of truth to these stereotypes.

~~~
gscott
I find at age 39 I cannot work my previous 12-16 hour days of the past, due to
my sedentary lifestyle. However I make up for it by sticking to what I know
will work rather then doing as much experimentation that I used to do. I get
months worth of work done in weeks.

~~~
tsotha
How do you think you'll perform at 50?

~~~
alextingle
My very first hire was a guy who was 50. I was 24 and my manager was 30 - we
were both intimidated by the thought of being the boss of someone so much
older than us.

For the first two weeks of his employment, the guy was quiet. Really, really
quiet. He just kept to himself and read the material I'd given him. I was
starting to get worried, when one day he asked to talk to me about his
tasks... He then proceeded to ask a series of incredibly pointed questions
about the work we were doing and his part in it. Not only had he absorbed the
details of our requirements, and our plans to meet them, but he had already
anticipated the problems & challenges that we would be facing months & years
down the line when it came to testing and delivery. He was completely on top
of his game.

As a youngster, my approach was very different from his. Lacking experience, I
would energetically tackle things head on, and deal with problems as they
arose. Working with this older guy really made me appreciate that other
approaches are at least as valid.

So, if someone is on top form at 40, they'll probably be even better at 50.

~~~
tsotha
One of my first hires was in his 50s, too. He kept falling asleep at his desk.

Not everyone ages well. While there are certainly great employees in their 50s
and 60s, you'll also find a pretty high percentage that

1\. Stopped learning 20 years ago, either because they didn't force themselves
out of their comfort zone or because they became experts at something and
couldn't take the financial hit to do something else as a non-expert.

2\. Have some sort of medical problem that affects their concentration. I work
with a guy who has terrible back problems for which he has pain meds. He can
go for a few hours without taking his meds and he's pretty productive then.
Otherwise he can't concentrate very well and doesn't add much. Nearly everyone
ends up taking blood pressure medications, and they have side effects.

3\. Have ordinary age-related cognitive decline. This is the big one. If you
were a genius at 30 you'll most likely be pretty smart at 50. But if you were
average at 30 you're going to be below average at 50, with below average
memory and reasoning skills. _Everybody_ has cognitive decline, even in the
absence of other problems. In many industries experience makes up for it. Not
so much in software.

Don't get me wrong. I'm not saying you shouldn't hire people over 50. All I'm
saying is there's truth in the stereotype.

