Unpaid furloughs a trend for U.S. white-collar jobs

Wed Feb 25, 2009 9:34am EST
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By Andrea Hopkins

CINCINNATI (Reuters) - U.S. newspapers have done it. California police have too. Governments in California, New Jersey and Ohio say it will save the budget. Forcing workers to take unpaid time off is a new version of the American layoff.

The involuntary furlough, once a staple of boom-and-bust blue-collar industries like mining or automaking, is making its way into white-collar workplaces across the United States as employers try to cut costs quickly amid a deepening recession.

With some 2.5 million jobs lost in the past six months, few furloughed workers are complaining about the unpaid time off.

"I think some people are more comforted by the furlough because they believe there is less risk of layoff," said Dennis Hoffman, an economics professor at Arizona State University who has been told he has to take 15 unpaid days off by July.

Hoffman isn't complaining about the pay cut, figuring it is better than losing more staff at the 114-year-old university. But like consumers across America, Hoffman views the forced time off as another reason to cut back on spending, a trend that is delaying a general recovery.

"It just doesn't feel comfortable to be out there spending ... you wonder when the next shoe will drop," said Hoffman. "Between this and the stock market, it is quite a bump in the pathway toward saving for retirement."

At the Gannett newspaper chain, which publishes USA Today as well as dozens of other dailies across the country, journalists are also ambivalent about news they all have to take a week off -- unpaid -- before the end of March.

ROUNDS OF LAYOFFS   Continued...

<p>Governor Edmond G. "Pat" Brown's state office building is shown in San Francisco, California in this January 29, 2009 file photo. REUTERS/Robert Galbraith</p>