Posts tagged with: Chicago Tribune

Unemployment worries still dog economy’s recovery

It’s hard to feel that the economy is getting better if you don’t have a job. But lately we’ve seen several positive reports suggesting that the worst of the recession may have passed us by. The economy, analysts say, is no longer in freefall.

But that doesn’t matter if you’ve lost your job and can’t pay your home mortgage, does it?

Gail MarksJarvis, a financial writer for the Chicago Tribune, does a good job summarizing why unemployment might slow the nation’s economic recovery significantly. You can read the story here.

MarksJarvis interviews financial experts who worry that the unemployment rate in the United States might hit 10 percent or higher and then stay there. If that happens, it can have a devastating impact on the rest of the economy. Think about it: With more people out of work, there’ll be fewer buying nonessential items at local stores. Fewer people will move into new homes. It’s all related.

So enjoy the good economic news reports. We certainly can use some good news these days. But remember, until unemployment goes down, we won’t see an economic recovery that truly feels like a recovery.

Unemployment slows down the housing market

For years, I’ve covered the housing industry for newspapers such as the Washington Post and Chicago Tribune. I also edit a real estate trade magazine. It’ve seen, then, just how hard it is for most people to come up with a downpayment of 20 percent when they want to buy a home.

If you don’t know, mortgage lenders for years asked borrowers to scrape together a downpayment equal to 20 percent of a home’s purchase price. That can be a ton of money. If you buy a modest house for $220,000, a downpayment of 20 percent equals $44,000. I don’t know a lot of people who have that kind of cash sitting around.

During the housing boom, though, lenders relaxed their standards. They began requiring far more doable downpayments of 5 percent, 3 percent or, in some cases, zero percent. That made it easier for people to buy homes. Of course, it also helped push the housing industry into the chaos it’s suffering through now with record foreclosures and plummeting housing values.

So the lenders have changed. Most have done away with no-down programs. Many others have even left behind the 5-percent-down programs. Many borrowers are now going with FHA loans, which require downpayments of just 3-and-a-half percent.

What does all this have to do with careers and jobs? Plenty, as it turns out.

Each year, the National Association of Realtors releases a study gauging the thoughts of the public regarding homeownership and housing affordability. This year’s study said that getting enough money for a downpayment was a stumbling block for 82 percent of survey respondents. And why is it so hard to get a downpayment? Partially because of the economy.

According to the Realtors survey, two-thirds of respondents cited layoffs and unemployment as serious problems today. A total of eight out of every 10 survey participants pointed to these problems as barriers to purchasing a home.

The housing market and the nation’s economy are linked together. And when they’re both performing as miserably as they are today, it makes life exceedingly difficult for most of us.

Something about this story really made me nervous

These are uncertain times. No one’s job seems to be truly safe.

But sometimes you just want to forget about that fact. Then you grab the morning paper — in my case, the Chicago Tribune — and you read a front-page story that really gives you the willies.

The story describes how quickly a family can fall from the ranks of the middle class to the poor after its primary breadwinner loses a job.

The Tribune story focuses on the Robbins family. When Patrick Robbins loses his job as a sportswear buyer making $110,000 a year, his family quickly goes from not worrying about money to almost suffocating with financial issues.

There’s something gripping about the story. Maybe it’s the fact that the Robbins family didn’t have that 6-month emergency cushion of savings that financial experts always tell us to have on hand. Thing is, I don’t know many families — if any — that have that kind of cushion built up.

Day-to-day life is expensive, isn’t it? Even if you have a good job, the bills pile up.

Maybe that’s what made me so nervous reading the Tribune’s story. The Robbins family could be my family, very easily. I suspect it could be yours, too.

A career to avoid: Anything doing with publishing

I’ve worked as a journalist since before I graduated from college in 1991. I love writing, and even more I love getting paid to do it.

But I wouldn’t advise any college student today to enter this field. It’s suffering. And there aren’t many signs that things are going to get better any time soon.

Just look at the evidence: The Chicago Tribune, my hometown newspaper, is bankrupt, has drastically reduced staff and has just finished a desperate redesign in an effort to draw in more readers. Its competitor, the Chicago Sun-Times is on life support.

Meanwhile, the proud Christian Science Monitor has become a largely all-Web enterprise. The Detroit Free Press is going to a three-times-a-week schedule and beefing up its online version. The Minneapolis Star-Tribune, a fine paper, has declared bankruptcy.

It’s depressing just writing about it.

Meanwhile, more and more journalists are turning to the Web. Problem is, online writing, while generally easier and less time-consuming than writing for print publications, doesn’t pay nearly as well.

It’s a tough world for journalists and freelance writers. So tough, I’d advise all you students to study something else.