June 1, 2003
Financial Wake-Up Call
When Lori Porcher, 40, was laid off from her job as an account supervisor for an advertising firm just seven months after landing the position, it was a sharp financial blow to the Syracuse University graduate. But when her younger sister, Lisa, 36, was also handed a pink slip less than a month later, the two — who live together in an upscale apartment complex in the Washington, D.C., suburb of Alexandria, Virginia — were left scrambling for ways to make ends meet.
To survive the financial crunch, they pooled their resources, using money from unemployment insurance checks, savings accounts, and 401(k) retirement plans to pay the bills. They trimmed the fat from their budget by eliminating many creature comforts, such as extra cable channels and telephone features, and started eating at home rather than at their favorite restaurants. Both say that the layoffs haven’t been easy, but having each other has made a big difference.
“We identify with each other’s struggle and support [each other] emotionally,” Lisa says.
The Porcher sisters are two of the 8.4 million people out of work as of March 2003, contributing to an unemployment rate of 5.8%, with 10.2% for African Americans, according to the Bureau of Labor Statistics. About one in five unemployed individuals had been without a job for 27 weeks or longer. And while the sisters are still jobless, they are working hard to find new positions. Given a U.S. economy that’s going into its fourth year of a downswing, and hundreds of thousands of displaced workers eyeing the classified sections, the Porchers won’t be alone in their search.
Since Sept. 11, people like the Porcher sisters have been traveling through a tunnel of financial despair. Along for the ride have been hordes of investors, carefully watching for the light at the end of that tunnel. But with a sluggish economy stubbornly refusing to show any signs of turning around, and a war in Iraq adding a new element of uncertainty to the stock and job markets, it’s clear that it may be some time before that light has a chance to shine. In the meantime, investors have had to rework their financial game plans or risk stalling altogether.
Discussing solutions to these current financial problems, especially their impact on African Americans, brought the BLACK ENTERPRISE Board of Economists together in March at the New York offices of Earl G. Graves Publishing Co. Inc. Earl “Butch” Graves Jr., E.G.G. Publishing president and chief operating officer, led the discussion. The board participants included: Dr. Thomas D. Boston of the Ivan Allen College, School of Economics, Georgia Institute of Technology in Atlanta; National Urban League Research and Public Policy Director William Spriggs; Darrell L. Williams of Los Angeles-based Economic Analysis L.L.C.; Jessica Gordon Nembhard of the University of Maryland; Bernard E. Anderson of Philadelphia’s Wharton School of Business at the University of Pennsylvania; and Gerald D. Jaynes, professor of economics at Yale University.
Ironically, at a time when many households have been hit hard by a poor economy, our economists