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Monthly Archives: August 2011

Tell Monster.com: Stop discriminating against the unemployed

On Monster.com, employers are allowed to prevent anyone who is currently unemployed from applying for a job.

It’s cruel to the millions of Americans out of work — but you can put an end to it this week.

Kelly Wiedemer, who lost her job in 2008, has launched a campaign demanding that Monster.com ban these discriminatory ads. I’m one of the original 99ers. Before losing my job amidst the worst economic crisis since the Great Depression, I was living the American Dream. I paid for my own college education, working full-time while attending night classes at Metropolitan State College of Denver. I bought my own home. And I had a great job as a business analyst.

That was then. In 2008, as the stock market crashed and companies were panicking, I became one of the millions of Americans laid-off and seeking employment. As an experienced business analyst, I routinely used sites like Monster.com and CareerBuilder to look for job opportunities. Gradually, however, it dawned on me that my status as an unemployed person was a serious problem. One agency rep told me after an interview, “I’ll recommend you to the hiring manager but your employment gap is going to be a hard sell.”

This is happening everywhere. Many employers are discriminating against the jobless by prohibiting us from even applying for open positions. And they’re using sites like Monster.com to do it.

The National Employment Law Project recently conducted a review of job listings on Monster.com and CareerBuilder and found 150 ads that included exclusions based on current employment status.

Employers shouldn’t be allowed to discriminate against the unemployed. Sites like Monster.com and CareerBuilder.com can do their part by banning these kinds of discrimatory employment ads from their networks.

This type of ad is already illegal in New Jersey, and there’s legislation pending in Congress that would do the same nationwide. Let’s force companies to end this practice.

A nationwide backlash against the company, which treasures its reputation as a website that helps people find jobs, will force Monster.com to act.
Sign the petition asking major employment websites like Monster.com and CareerBuilder.com to refuse ads from companies that prohibit the unemployed from applying.

The solution is simple – major job sites like Monster.com can just say “no” to discriminating against the unemployed. By preventing these ads from running on their job networks, they’ll help end this practice by employers.

Please sign the petition today asking Monster.com to stop discriminating against the unemployed.

Thanks for being a changemaker,

– Jess and the Change.org team

This email was sent by Change.org Start a petition.

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Posted by on August 19, 2011 in Career Changes

 

MBA Debt: The Burden Grows Heavier & Gets Scarier

In 2008, Brian Jenkins moved to Malibu, Calif., to start his MBA at Pepperdine University’s Graziadio School of Business and Management. He had big ambitions for B-school, expecting the degree to help him land a job in human resources at a top company. He hoped to make close to a six-figure salary, too.

Pepperdine seemed poised to deliver. When he was a mere applicant, the admissions director gave him a personal tour of the business school, which commands a stunning perch overlooking the Pacific. His student experience was “amazing,” he says, handing top marks to his professors and classmates. He loved his courses and wrote an up-beat student blog. The weather – “perfect every day” – was an added perk.

To pay for all it, Jenkins took out $120,000 in loans. But Jenkins’ six-figure-salary job never materialized. “The career services staff basically said, ‘We’ll help you edit your resume, good luck out there,’” he recalls. “That was a little miss-sold to me (when I applied). A lot of (my classmates) found jobs paying $55,000 to $65,000 per year, and they were very excited that they had a job. A lot of people didn’t get jobs like that.”

In fact, Jenkins’ class earned a mean base salary of $69,167, according Pepperdine’s official stats–but they also owed an average $66,242. But the school that ranks 78th in the country happens to rank 20th in having the largest MBA debt. When the economy was doing well, and there was upward mobility, it made not have made all that much of a difference. MBAs then made sense, Jenkins believes. “People were able to mange their debt load. (Now), people are putting off families and buying homes.”

SIX-FIGURE DEBT IS NOW COMMON FOR MOST TOP MBAS

MBAs like Jenkins are shouldering record levels of debt, approaching a tipping point that makes the degree – no matter how good the experience and learning – a risky investment that isn’t always being approached with financial caution and restraint. It’s now common for many graduates to leave a top business school with six-figure debt, and in some cases, MBAs are graduating with more than $150,000 in loans that will take them ten or more years to pay back.

At a few elite business schools, including Wharton and Columbia, the “average” debt burden is already in six figures. Wharton grads left Philadelphia last year with loans that averaged $109,836–the most among all B-schools. Overall, graduates from Poets&Quants’ top-ten U.S. MBA programs owed an average $87,049 last year (MIT-Sloan did not release its debt figures). (See 25 B-Schools That Lead to the Most Debt)

Several business schools, including Stanford and Dartmouth College’s Tuck School, expect these numbers to go much higher this year. The reason: Many students are starting their MBAs with diminished assets due to the Great Recession. They drained their bank accounts as the economy went south to maintain their lifestyles so many of them will have to borrow more than earlier classes to get the degree. And they’re doing so at a time when starting salaries for MBAs, by and large, have flattened.

“The numbers scare me,” concedes Diane Bonin, director financial aid at the Tuck School. “People coming in are making a little bit less and have much less in available savings.” She expects the average debt burden of latest Tuck grads to rise to $98,500 from the record $96,292 last year.

‘IF YOU’RE RECKLESS (WITH STUDENT DEBT), YOU CAN CHOP YOUR ARM OFF’

Taking on debt has become a big enough issue to a few MBA hopefuls and alums that several have started blogs to address it. No Debt MBA, a Boston-based female blogger who will begin classes at a top B-school this fall, vows to get through the experience without a dollar of debt. “I think debt is a lot like a miter saw,” she says. “As a skilled user it can be a really useful tool for getting work done, but if you’re reckless you can chop your arm off. Many students seem to be blissfully chopping away, and I am slightly terrified of becoming one of them.”

The MBA-bound blogger, however, is a rare exception. In general, the incoming Class of 2013 expresses little concern over taking out the “miter saw.” Like Jenkins at Pepperdine, they’re betting that the degree will payoff in the long run, providing salaries and bonuses that will easily allow them to repay the loans. “No one says, ‘how am I going to pay for this?’ says Rod Garcia, director of MBA admissions at MIT’s Sloan School. “I’ve been doing this for 23 years. A place like MIT is a low risk, high reward investment. With other schools, it may not be that situation.”

by Mica Bevington

 
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Posted by on August 18, 2011 in Career Changes

 

Why Skills and Experience are Irrelevant when Hiring

One reason hiring fails is because people focus on the person’s skills and experience, and then if everyone likes the person, they are the right person and will be successful. This is not true. I have asked thousands of CEOs and key executives if they have ever hired someone with an excellent resume, that had all the right skills and experience, that the interviewing team really (I mean really) liked and once that person came on board the person fell flat on their face within 6 months. Usually about 99% reply, “Yes.” How could this happen if skills and experience are so relevant? The fact is, just because a person has all the right skills and experience and everyone likes them, that doesn’t mean that they will be successful. These things are important but having the right skills and experience isn’t what is relevant when making a good hire. What is relevant when making a good hire is whether or not the person can apply these skills and experience in your organization. Can they apply them to achieve the results you need? Can they apply them effectively in your culture? If they can’t, they are not the right candidate for your organization.Skills and experience are simply tools every candidate brings to the job. The ability to use them effectively is what matters. I know many people that have golf clubs in their car and have been playing golf for 20 years, can swing the club over 100 miles per hour, and have taken so many lessons that if an MBA in golf existed they would have one. Even with all of these skills and experience they still aren’t on the PGA tour. Why? Because having skills and experience is different from applying them. When hiring, it is important that the person you choose can apply these effectively in your organization and your culture.One problem is that when we define things around skills and experience the interviewing process often becomes focused on these rather than the real job. For example, if you were hiring a CFO, most job descriptions would define the ideal person as a CPA, 10+ years experience, 5 years industry experience, knowledge of GAAP, financial reporting, cash management experience, good leadership skills, etc. All of these are important, but not what you really want to hire. What you really might want is a CFO that can improve cash flow by 10%, implement a cash management system, reduce overhead costs by x% within x number of months and have accurate financial statements within three days of the close. This is the real job and requires the person to have the right skills and experience or they could not achieve these goals. When you are ready to make your next hire, instead of focusing on the person’s background, focus on how they would apply those skills and experience to achieve the results you are seeking. Ask yourself this, “If you hired someone with all the skills and experience listed above, what are the odds they could achieve the results listed?”Just because a person has the skills and experience you seek doesn’t mean they can deliver the results you need. But if they can deliver the results you seek that means they have the skills and experience you need. I don’t know if that is 10 years, 8 years, or 15 years, and it doesn’t matter, they have enough to deliver the results.

 
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Posted by on August 15, 2011 in Career Changes

 

S&P downgrades U.S. credit rating

Expectations of such a move after Friday’s close helped pummel stocks in morning trading. Here’s what it could mean.

As many had expected, Standard & Poor’s finally decided to cut the U.S. credit rating late Friday. The world’s largest economy lost its perfect AAA status, tumbling by one notch to AA-plus.

The decision came after a day fraught with twists and turns, keeping everyone from President Barack Obama to individual investors on pins and needles. Rival ratings agencies Moody’s and Fitch had already said they wouldn’t downgrade the U.S., leading some observers to predict that Standard & Poor’s wouldn’t go solo on such a controversial position.

But others thought a downgrade was inevitable, particularly after S&P placed the country’s perfect AAA credit rating on “CreditWatch negative” on July 14. That status generally means the agency will make some ratings move within 90 days. The rumor was resonant enough that it helped punish stocks in early trading Friday.

S&P notified the Treasury Department early Friday afternoon that the downgrade was coming, The Wall Street Journal reported, but Treasury officials looked at the numbers and found that S&P had miscalculated future deficit projections by nearly $2 trillion.

S&P reportedly agreed it had made a mistake. But then it went ahead with the downgrade anyway.

For the U.S., losing that perfect rating could have an impact on interest rates nationwide. It may ruin the country’s global reputation as the safest investment option. And it could damage the American psyche — wait, we’re not the best in the world?

Now that the downgrade has taken place, here’s how the country and its consumers could be affected:

Interest rates: The previous top-notch AAA credit rating meant the U.S. pays lower interest on its $14.4 trillion in debt. With a downgrade, the country would likely pay slightly higher interest rates on its debt.

That would also hold true for consumers, as interest rates on consumer loans generally pace government debt (often the 10-year Treasury). Home mortgages, car loans, bank loans and other debt would likely carry higher rates.

Stock market impact: More observers are starting to think there wouldn’t be much market response to a downgrade. That’s because U.S. pension funds, insurance companies and other large investors are generally not required to hold AAA-rated debt, Reuters reports. They have some flexibility and likely wouldn’t be forced into action.

It’s generally expected that investors would pull $40 billion out of U.S. Treasurys if the downgrade takes place. That’s practically nothing, considering there are about $10 trillion in tradable U.S. bonds, experts say.

Global response: Well, not much. Even S&P executives say global markets have already discounted to the potential risk of a U.S. downgrade.

Political impact: No politician wants to see a credit downgrade on his or her watch. It would be a source of embarrassment for President Barack Obama and members of Congress. And a downgrade would add more pressure on lawmakers to cut the deficit, which Fortune says will stall economic growth.

Dollar: There’s a reason people worldwide buy the dollar and store their savings in U.S. dollars. It’s widely been considered the safest option, a stable currency in any event.

That would change. People wouldn’t be as keen to buy the U.S. dollar, and already they are turning to Australia, Germany, Austria and other countries for haven investing. The dollar could lose its status as the world’s reserve currency.

At any rate, some Americans are taking a rather defiant stand. Go ahead and downgrade the U.S., they say. It will survive. We don’t need to quiver in fear as the ratings agencies threaten us. Who even needs ratings agencies, anyway?

U.S. economist Zachary Karabell put it this way: “The best possible outcome would be for them to downgrade the U.S. — and for the world to shrug, with rates set by the multitude of buyers and sellers. That would at least demonstrate that these emperors, clothed though they are, wear very frayed robes.”

Another economist, Tyler Cowen, says he’s not sure how the markets will respond and he doesn’t think an alarmist reaction about the market is appropriate. “A letter grade is a letter grade and the facts on the ground did not change today,” he writes. “It may or may not lead to a major sell-off. Still, years from now today may well be seen as a turning point of significance.”

By Kim Peterson on Fri, Aug 5, 2011 2:03 PM
Updated 8:30 pm ET

 
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Posted by on August 6, 2011 in Tax Relief

 

The “What Ifs” Of An Economic Downturn

The “What Ifs” of an Economic Downturn Video: What If?The Internal Revenue Service recognizes that many people may be having difficult times financially. There can be a tax impact to events such as job loss, debt forgiveness or tapping a retirement fund. If your income decreased, you may be newly eligible for certain tax credits, such as the Earned Income Tax Credit.Most importantly, if you believe you may have trouble paying your tax bill contact the IRS immediately. There are steps we can take to help ease the burden. You also should file a tax return even if you are unable to pay so you can avoid additional penalties.Here are some “What if” scenarios and the possible tax impact:.

What if I lose my job?
What if I receive unemployment compensation?
What if my income declines?
What if I am searching for a job?
What if my employer goes out of business?
What if I close my own business?
What if I withdraw money from my IRA?
What if my 401(k) drops in value?

What if I lose my home through foreclosure?
What if I sell my home for a loss?
What if my debt is forgiven?
What if I am insolvent?
What if I file for bankruptcy protection?
What if I can’t pay my taxes?
What if I can’t pay my installment agreement?
What if there is a federal tax lien on my home?
What if a levy on my wages is creating hardship?
What if I can’t resolve my tax problem with the IRS?
What if I need legal representation to help with my tax problem but can’t afford it?

Related Items:

Tax Tip 2011-68, Three Ways to Pay Your Federal Income Tax
•Special Edition Tax Tip, IRS Help for Financially Distressed Taxpayers
•IR-2011-42, April 18 Deadline Approaching; Check IRS Payment Options
•IR-2011-20, IRS Announces New Effort to Help Struggling Taxpayers Get a Fresh Start; Major Changes Made to Lien Process
•IR-2010-29, IRS Outlines Additional Steps to Assist Unemployed Taxpayers and Others
•Payment Plans, Installment Agreements
•Offers in Compromise
•Tax Center to Assist Unemployed Taxpayers

•Publication 4763, Job Related Questions During an Economic Downturn

 
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Posted by on August 4, 2011 in Tax Relief