One female CEO will hand over the reins to another—a first for a major company. But Burns has her work cut out for her

By Nanette Byrnes and Roger O. Crockett

Ursula M. Burns isn’t one to savor victory—even if it’s being the first African American woman to lead a major U.S. corporation and the first female CEO to take the reins from another woman. Within days of being named chief executive of Xerox (XRX) she was on a plane to Europe. The mission: a 30-day tour to meet with staff outside the U.S., where Xerox has almost half its sales, and discuss ways to get customers buying again. “I think the celebration of her announcement ended about 60 seconds after the e-mail went out,” says Clarke Murphy, a recruiter at Russell Reynolds.

Burns, 50, has a war to fight. Xerox, a brand so synonymous with copying that its name long ago became a verb, faces a brutal business outlook. Customers are buying less equipment. Prices keep dropping. Managers are curbing paper use for cost-saving and environmental reasons. While departing CEO Anne M. Mulcahy, 56, pulled the $17.6 billion-a-year copier giant from the brink of bankruptcy and restored profitability, her successor has much to do. Burns will find herself battling competitors with stronger balance sheets and more heft as the industry consolidates. The Norwalk (Conn.) company’s sales dropped 18% in the first quarter, to $3.6 billion, producing a profit of only $49 million. The stock, trading at more than 14 a share in September, is now less than half that.

And yet expectations are high as Burns ascends to the CEO post. Executives inside and outside the company speak of her deep industry knowledge and technical prowess, as well as her frankness, sharp humor, and willingness to take risks. For many working mothers, it’s inspiring to see Mulcahy, a mother of two grown sons, step down in favor of a woman who has a 16-year-old daughter and 20-year-old stepson—and was herself raised by a single mother in a New York City housing project. “This is a bases-loaded home run,” says Noel M. Tichy, a professor at the University of Michigan Ross School of Business. “We now have something to share with our MBA females that we’ve never had.” Adds Robert A. McDonald, chief operating officer of Procter & Gamble (PG) and a Xerox board member since 2005: “Ursula is a strong leader who has an unusual ability to understand the power of technology and innovation.”

The excitement is understandable. Three decades after women flooded into professional jobs, the C-suite continues to be dominated by men. While women now make up 59.6% of the U.S. labor force, fewer than 16% of top corporate officers are female, according to Catalyst, an advocacy group that tracks women’s advancement in the workplace. For minorities, the figures are even worse. Avon (AVP) CEO Andrea Jung became the first nonwhite woman to lead a major company in 1999. Frank D. Raines, former chief of Fannie Mae (FNM), became the first African American CEO of a top company the same year, though he later left amid an accounting scandal. By 2007, there were seven black men running major corporations. Since then, three have left. While other black women have run major divisions, Burns is the first to lead a large public company.

“CLASSIC NEW YORKER”

A mechanical engineer by training, Burns has a strong understanding of the business and its challenges. Like Mulcahy, she’s a Xerox veteran. She came to the company as a summer intern in 1980, joining full-time a year later after completing her master’s degree in engineering at Columbia University. Xerox was drifting at the time, having largely ignored the threat posed by Japanese copiers and new office printers, while failing to get innovative products to market. She took on roles of increasing responsibility, distinguishing herself as a quick study who could handle multiple tasks at once and wasn’t afraid to flag a problem. “Ursula is your classic New Yorker,” says Christa Carone, Xerox’s vice-president for marketing and communications. “She’s known for being very frank.”

Reginald L. Brown Jr., CEO of consultancy Brown Technology Group, says many colleagues saw her as CEO material almost two decades ago. Brown began working with Burns in the late 1980s in Xerox’s custom systems division, which helped clients switch from standard copier machines to ones that could be integrated with computer networks. When Burns was appointed special assistant to Wayland Hicks, then president of marketing and customer operations, in 1990, everyone knew she was on the fast track. “These were jobs in the company that division presidents put their best people in,” says Brown. “Most of them were white males, so to have an African American female in such a position of power, you knew early on she had great potential.” She later took on a similar role with then-CEO Paul A. Allaire. Appointed general manager in 1997 and vice-president for worldwide manufacturing two years later, Burns helped lead a push into color copying.

But the overall business continued to struggle. By the time Mulcahy took over as CEO in 2001, Xerox was in deep trouble. Customers had migrated from Xerox’s stand-alone copiers to using cheaper desktop printers to get multiple copies of documents. Rivals such as Canon and Hewlett-Packard had stolen the lead in key product areas, and the company had pulled down almost its entire credit line as the business hemorrhaged money.

Early in Mulcahy’s tenure, she forged a partnership with Burns. Over time, she entrusted her lieutenant with much of the day-to-day operations while she focused on improving customer service and Xerox’s financial health. Mulcahy oversaw major moves such as shedding the desktop printer business while trying to get the balance sheet in shape.

All the while, Tichy observes, Burns was the one who was “clearly running the majority of the business.” With the company in crisis, she helped downsize the workforce by close to 40%, to 57,100 from 94,600. She spearheaded Xerox’s move out of manufacturing, with Flextronics (FLEX) now making most of the actual copiers. Burns, who was named president in 2007, also identified some gaps in its offerings, filling them with lower-end products from Xerox or partners. That has given the company its largest product portfolio in history and allowed it to be more competitive in selling to small and midsize businesses. And she has proven adept at garnering the support of the board. “She understands the technology and can communicate it in a way that a director can understand it,” says P&G’s McDonald.

Another factor in Burns’ rise has been the strength and depth of Xerox’s commitment to diversity. One-third of Xerox’s 3,819 executives are women and 22% are minorities. Employee affinity networks first sprang up in the late 1960s, and senior executives have long had responsibility for sponsoring them. Burns was a liaison to the Hispanic employees’ caucus. “It was a system that allowed you to be recognized” at a time when women and minorities often weren’t, notes Nina Smith, who moved up the ranks at Xerox at much the same time as Burns, eventually becoming chief marketing officer. She’s now a senior vice-president at IT consultant Mitchell International.

Much of what Xerox does is now replicated in other companies: an Executive Diversity Council, leadership programs, and performance reviews that rate managers on their ability to recruit, mentor, and promote underrepresented groups. (If they don’t hit the mark, their review, pay, and chances at promotion get dinged.) What has distinguished Xerox is less the outline of its programs than the actual makeup of its senior ranks. As Harvard Business School professor David A. Thomas observes: “You have a culture where having women and people of color as candidates for powerful jobs has been going on for two decades.”

Now, Burns’ toughest job will be restoring the company’s top-line growth. Equipment sales were down 30% in the first quarter. And once fast-growing developing markets, which make up 15% of sales, have slowed to a crawl with demand in countries such as Russia off 33%. While analyst Richard Gardner of Citigroup Global Markets argues that the company’s strength in color printing and recent acquisitions should help it rebuild, he expects a steep dip in sales this year, to $14.7 billion.

Xerox says its investment in innovative products will help it emerge from the recession stronger. But Gartner Group says it expects corporate purchases of copiers, printers, and other hardware to remain flat through 2012 while prices will continue to slide. And Fitch Ratings put Xerox’s $9 billion in BBB-rated debt on a negative outlook after the first-quarter numbers came in. “Will they be able to make acquisitions?” asks Fitch analyst Nick N. Nilarp. “Or will they just continue very slow growth, if at all?”

In the short term, analysts hope Burns will focus on reviving sales in emerging markets while continuing to expand into higher-margin services at home. And Xerox needs to be more efficient to compete against aggressive and deep-pocketed competitors.

While Burns has much to do to rebuild Xerox’s strength, she’s aware of the significance of what she has already achieved. As president, she once told an audience at the YWCA in Cleveland: “I’m in this job because I believe I earned it through hard work and high performance. Did I get some opportunities early in my career because of my race and gender? Probably. … I went to work for a company that was openly seeking to diversify its workforce. So, I imagine race and gender got the hiring guys’ attention. And then the rest was really up to me.”

With Jena McGregor

By Dave Sheinin
The Washington Post
Friday, May 22, 2009

TALLAHASSEE — Not so long ago, you wouldn’t have needed to ask Peter Boulware what brought purpose to his life. Purpose was a three-point stance, a speed-rush and a quarterback planted in the turf. Purpose was staying strong, staying healthy, staying paid. Off the NFL field, where he spent eight seasons, made four Pro Bowl teams and won a Super Bowl, purpose was starting a family, socking away some money, trying to set the Boulwares up for life.

But now? With his playing days behind him, and the family and the finances both as beautiful and healthy as can be, it’s the question that hovers over Boulware, the question that makes him flinch — the question, really, that every retired athlete has to confront: What brings purpose to life now, when the game has used you up but when, by conventional measures, you’re still so young and so rich?

Boulware, 34, contemplates the question. He is sitting at his kitchen table, in the middle of the day, in the middle of the week, with nowhere else he needs to be. Purpose, at this very moment, is a glass of iced tea and some central air conditioning.

Since his retirement from football, personal life has revolved around family — wife Kensy and their four children, whose ages range from 5 months to 6 years — while professional life has been built around the Toyota dealership for which he is a vice president and part-owner, as well as a surprising run for the Florida House of Representatives last fall. But the dealership is more an investment than a career and he lost his maiden political race, leaving him uncertain if he wants to do it again.

“One of the toughest things for athletes, or men in general,” Boulware says, “is to have something outside the household that you can say, ‘This is what I’m good at.’ Being a pro athlete, you’ve always been the best at what you do, so you want to get into a field where you can be the best, not just average. Finding that field, I think, is where most guys have their toughest struggle.

“I believe I can be a good husband and a good father to my kids. But getting outside that arena and finding something where I can say I’m the best at, that’s hard to find. I can’t say I’ve actually found that yet.”

Rare is the athlete who does find it. In the last 10 to 15 years — since the first waves of multimillionaire athletes, beneficiaries of the big-money free agent era of professional sports, began reaching retirement — the news is full of stories of squandered fortunes, aimless lives, failed marriages and mental-health issues. Few retired athletes, it seems, are good at the game of life.

According to the NFL Players Association, the average NFL player’s career lasts about 31/2 years, and by some estimations as many as 80 percent of retired players endure either divorce or bankruptcy, the majority of those within two years of retirement.

For any athlete, purpose number one ought to be avoiding either of those.

“I’m a Christian,” Boulware says. “So my purpose and direction come from God. I believe my first purpose is to be a good husband to my wife, and a good father to my kids. God has blessed me financially. I can be [home] in the middle of the day and spend time with my kids. Anything beyond that is extra for me.”

The Political Arena

There’s not as much weight at the ends of the barbells as there used to be — or between Boulware’s neck and waist, for that matter. He is down 30 pounds from his playing weight. He lifts about 75 percent of what he once did, and resists the impulse to think of himself, by extension, as 75 percent of the man he once was.

What purpose, this? Just staying in shape, man. Every other morning, at the gym up the road from his house, weights downstairs, cardio upstairs, with retirees — the real kind — pedaling away at the stationary bikes next to him.

“Are you going to run for Congress next time, Peter?” asks one of them, 85-year-old Philip Poole, who got to know Boulware at the gym and became a financial supporter of his state house run.

Boulware says he doesn’t know yet. That’s still a ways off.

“Well, if you do, I’ve got some money for you,” Poole says with a smile. “Right up to the legal limit.”

“I appreciate that.”

The political thing came out of nowhere last year, floated initially by a friend with ties to the Republican Party, which had come to view Boulware as its best hope for wresting control of the state District 9 house seat, historically an unassailably Democratic stronghold. Other than Bobby Bowden, who coached Boulware at Florida State, there may be no more popular figure in Tallahassee than Boulware — an all-American out of Columbia, S.C., who led the Seminoles to the ACC title every year he played, then returned to make the town his home following a nine-year career with the Baltimore Ravens.

“I personally saw something in him as an individual that I thought this country was all about,” says the friend, John Davis, director of minority outreach for the state Republican Party. “Peter is someone I consider to be the model person. This is a man who gets it, who can connect with people and can interact with any sector, from the bourgeois to the lower class and everywhere in between.”

That Boulware even considered running shocked his family and others close to him, and when he decided to go ahead and do it, they wondered if, for the first time, he was giving in to his athletic id — the allure of commanding the spotlight again, the inflated sense of self that makes famous people believe they would be good at anything. He assured them his intentions were good.

“I wasn’t looking to make a big name for myself,” he says. “I didn’t even want to do it at first. I’m thinking to myself: ‘I’m not a politician. I play football.’ I thought you needed experience, a law degree. I thought, ‘I’m inadequate. I don’t have those things.’ . . .

“But I bounced it off my wife and some other people, and I said: ‘You know what? I’m going to do this, because it’s the right thing to do — as a way to serve and try to get involved in the community. Not because I wanted to be a politician.’ ” And so, he ran. He raised a half-million dollars for a job that pays $30,000 a year. He knocked on thousands of doors, wiping spider webs off his face in the dewy mornings and fending off bees, dogs and sprinklers in the blazing afternoons.

“It was probably one of the most humbling things I’ve ever done,” he says. “Coming from the NFL, where you’re a superstar and signing autographs and stuff, and now it’s 100 degrees and you’re knocking on someone’s door asking for their support? But as a professional athlete, I needed that. I needed to be brought back to reality and see regular people and regular problems.”

The odds could not have been more stacked against him. Though he played down his party affiliation during the campaign (“I wish I didn’t have to have a party attached to my name, to be honest with you,” he says now), running as a Republican in Florida’s District 9 — which is largely defined by Tallahassee’s double-whammy as both a university town and a state capital — was almost guaranteed to be a losing proposition.

But Boulware almost did it, coming within about 400 votes, out of 80,000 cast, the minuscule margin of defeat doing little to ease the sting of losing.

“There were a lot of people who supported me,” he says now. “I felt like I let them down.”

In the fallout from the loss, Boulware found a consolation prize. Thumbing through a booklet of open state appointments that arrived in the mail one day, he circled an item about a seat on the Florida Board of Education. “I could do that,” he said. He applied, was chosen by Gov. Charlie Crist (R) and in January began a year-long term.

He has no definitive thoughts about his next political move, or whether there will even be a next move — but others have thoughts for him. If the atmosphere became just a little more hospitable for Republicans next year, perhaps he could make up those 400 votes and then some.

“It’s definitely not over yet,” Davis says. “I really believe one day we will be talking about Peter Boulware, the elected official.”

And then there’s the 2nd Congressional District seat, held for the past 12 years by Democrat Allen Boyd. Because it extends well beyond Tallahassee into rural north Florida — which is often characterized as an extension of the deep South — it is seen as more winnable for a Republican, and in fact the district voted 54 percent for John McCain in the 2008 presidential election.

“Yeah,” says Jim Greer, the state GOP chairman, “I definitely think a congressional run is somewhere in his future.”

One problem: “I don’t think I want to run anymore,” Boulware says. “But I’ll keep the door open. I can honestly say I’m not doing this to try to make a name for myself, or to push an agenda, or fill a void that football left. I mean, the process is too hard. Walking the neighborhoods and waving signs, and the amount of time you spend away from your family — it’s just too hard a process.”

To put it another way: He doesn’t need the aggravation. If that’s what purpose is supposed to be at this stage of life, he can do without it.

Spending Wisely

It’s 1:30 p.m., and for the first time all day, Boulware does something resembling work — and immediately wishes he hadn’t. Sitting at his nearly bare desk above the sales floor of Legacy Toyota, Boulware scans the company’s latest monthly sales report, and instinctively his forehead sinks into the palm of his giant left hand, while his right hand flips each ugly page.

“It’s bad. It’s real bad,” he says absently.

Minutes later, Boulware is standing on the floor of the dealership’s collision center, where roughly two-thirds of the repair stations are empty. He is talking with an employee, the manager of the collision center.

“We gotta move some units,” Boulware mutters. The manager nods grimly.

Boulware made $33.2 million in salary and bonuses during his NFL career, according to an industry source with access to that information, and by all accounts was smarter about what to do with it than just about anyone else in his position. He’s doing just fine, thanks.

“Playing in the NFL, it definitely set me ahead a little bit,” he says. “But I still feel I have to be wise and invest wisely. I can’t take the money from the NFL and put it in a shoebox and live off it. It has to grow for me to live the way I want to live.”

Nothing about the Boulwares screams outrageous wealth. They live in a large but not ostentatious house in a neighborhood lined with old oak trees. He drives a Tundra truck, Kensy a Sienna minivan — both dealer cars provided by Legacy Toyota. In every way, his appears to be a bling-free existence — not because he can’t afford it, but because he doesn’t need it.

“Back when he was still playing, we’d see a nice car go by, and [Boulware] would say, ‘Man, I wish I had that,’ ” said Adrian Crawford, a former FSU basketball player who played professionally in Europe, and who remains one of Boulware’s closest friends. “I’d be like: ‘Well, go buy it. You can afford it.’ And he’d go, ‘No, I can’t.’ ‘You can’t?’ And he’d say: ‘This ain’t gonna be here forever. It’s gonna dry up. And I gotta be ready when it does.’ ” This wasn’t a learned behavior; it was Boulware’s nature, instilled since birth. He grew up in a family of overachievers. His father was a doctor. His sister became a psychologist. One brother is an engineer. The other, Michael, followed Peter to FSU and the NFL. Not a big spender among them.

“His parents taught him the value of money,” says Kensy, a former FSU volleyball player. “They made him work hard for it.”

So when Boulware arrived in the NFL in 1997, he set himself up with a modest monthly allowance, saving and investing the rest. He wasn’t the first to do so, but he may have been the first to not only adhere to the allowance — but to cut it back as his earnings increased. In retirement, he’s still cutting.

“Every year, we’ve been cutting it back and back. It’s been good. As bad as this recession is, it’s forced our family to look at things and say: ‘You know what? This is important. That is not important. We can live with this, and we can live without that.’ “Financially, I’m in a position where I don’t really have to do that, but I think it’s smart.”

Boulware first bought into an auto dealership 10 years ago, still early in his NFL career, viewing it both as an investment and a potential post-NFL career path. “We always thought he’d come back [to Tallahassee], maybe even go to dealer school,” Kensy says. “We thought he’d really be involved [in the dealership's operation]. And then the political thing came along.”

These days, Boulware goes to the dealership about twice a week, including sitting in on a weekly board meeting. His office appears mostly unused, with the shelves behind his office desk almost bare, and framed posters and other artifacts from his playing days leaning against walls on the floor, waiting to be hung.

If it seems unlived-in, it’s partly by design. The agents and lawyers and accountants and financial advisers — they all tell you to think about your goals after your playing days are over. But this was one of Boulware’s:

“One of my main goals,” he says, “was to set myself up financially to where I had enough income and wasn’t forced to go to work every day if I didn’t want to . . . I didn’t want a job where I clocked in at 8 and clocked out at 6.”

Emotional Transition

The end was ugly. It usually is.

The aftermath was worse. It always is.

Two knee operations, a reconstruction job on his foot. He sat out the entire 2004 season because of injuries. The pain in his toe was so great, at the end, Boulware had to wear a shoe two sizes too big just to get on the field.

“That’s when I knew it was over,” he says now.

The Ravens released their all-time sacks leader without so much as a press release.

And then, the darkness.

“I always said when I was playing, ‘You know what? If I had to let this thing go, I could let it go and be fine.’ And it was until I had to retire that I said, ‘You know what? As much as I thought I was prepared — emotionally, I’m really not ….. . I could have played another three or four years.’ I felt like I got shortchanged because I got hurt.”

The 2006 NFL season, his first away from the game, went unviewed and undiscussed at the Boulware homestead. Other than a cathartic trip back to Baltimore that November to be inducted into the Ravens’ Ring of Honor, he stayed as far away as possible.

“You do something your whole life. You’re used to being the best at what you do,” he says. “You’re on top of the world one moment, and the next moment you’re out. It just takes time to get over.”

In the players’ parlance, it is called the “transition,” and in the past decade or so an entire industry has sprung up around it: special departments within the unions, including the NFL Players Association, to help players deal with it; agencies and institutes that specialize in conquering it; university departments that study it; magazines targeted towards the newly transitioned (“Keep living the dream” was the motto of one, which recently went under).

Boulware consulted none of them. His support system was tight-knit: Parents, wife, pastor, God. He didn’t know exactly how he wanted his transition to go, but he knew how he didn’t want it.

“I’d see a lot of guys [go through it], and I’d say, ‘I want to try to be not like them,’ ” Boulware says. “But it’s hard to do. It’s one thing to prepare yourself financially. It’s another thing to prepare yourself emotionally. I just don’t think it’s possible. There’s a time in there between retirement and the next thing where — it’s just like a little mourning period, where you have to just get it out of your system.”

“It was hard watching him go through it,” Kensy says. “It was hard to see. But at the same time, it wasn’t that hard — if that makes sense. We talked a lot. Not to belittle it, but it wasn’t that terrible.”

This past NFL season was the one that finally got him past it, to the other side. Watching the games, he was struck by something. Either the game had gotten faster and more violent, or he had simply gotten old. And either way, he was right where he needed to be — on his couch.

“This year, I could honestly watch the game and say, ‘Those guys are too big and too strong and too fast — I’m glad I’m not out there,’ ” he says. “It took a while, but I’m okay with being out [of the game] and okay with watching it, and I can honestly say the game has passed me by.”

Reaching peace with the past was a major milestone in Boulware’s life, but it still leaves the future. And if he doesn’t quite have that figured out yet, so what?

“I don’t feel like I’m searching for something,” he says resolutely. “I believe there’s something out there in my future. I believe God has a great plan for me. I believe there’s work and things for me to do out there. But I don’t want to be the guy [who's] always looking for something: ‘What’s my next move, my next jump?’ . . .

“I feel like I’m one of the most blessed people in the whole world. Gosh, I played in the NFL, the Super Bowl. I have a great wife, kids. I have nothing to complain about.”

“This is where his identity is — family, fatherhood,” Kensy says, motioning around the house. “He’s right where he needs to be.”

And at this point, at this stage, in Peter Boulware’s position, what’s wrong with that? If purpose means diapers and bottles, minivans and Elmos, enough work to keep you honest and enough options down the road to make your head spin — well, who among us wouldn’t take that?

By Jim Stinsin of the Rochester Democrat and Chronicle

Kevin Hoock was the longest tenured employee at the Tyco Electronics Corp. plant in Brighton when he was laid off last September. The manufacturing supervisor had worked at the plant for 28 years.

He received a severance package and left with his 401(k) retirement savings. But eight months later, Hoock, 53, still hasn’t found another job.

He and his wife don’t want to leave the region. “My roots are here, my parents are here,” said the Henrietta resident. More than that, the Hoocks lost their 17-year-old son, Trevor, to an illness in 2003 and regularly visit his grave.

People like Hoock — a white man in the 45-to-54 age category — haven’t experienced joblessness in the numbers they are now since the federal government began tracking employment by demographic groups in the early 1950s. Almost 8 percent of men in that group are unemployed.

Nationwide numbers show that the current recession, which originated in the white-collar canyons of Wall Street, is affecting experienced workers to an unprecedented extent, but young African-American and Hispanic workers have been hardest hit. The figures also show that education counts more than ever and that unemployment has been significantly less widespread for women than for men.

The jobless rate for black men reached a Depression-like 26 percent in the first quarter for those between ages 20 and 24, and 20 percent for those between 25 and 34. For Hispanic men, the corresponding rates were 16 percent and 13 percent. Generally, those levels were the highest since the deep recession of the early 1980s.

Employment experts see joblessness continuing to rise during the rest of this year and probably into 2010 as well, even as the economy starts to recover in other ways. Current overall rates are 8.9 percent for the United States and 8.3 percent in the Rochester area.

People who didn’t finish high school are disproportionately affected by layoffs, according to the U.S. Bureau of Labor Statistics, which says even low-paying job openings are disappearing. Unemployment was 16 percent in the first quarter for men without a diploma and 14 percent for women.

To make things more difficult, those workers face growing competition from low-paid workers in Asia who can handle jobs in fields such as customer service, said Gary Keith, senior economist for M&T Bank.

Better for women

As educational attainment rises for both men and women of all races, unemployment eases. The rate for men with a bachelor’s degree is 4.5 percent — comparatively low but still the highest for that demographic group in 17 years. Women with at least a bachelor’s have one of the lowest jobless rates of any group, 3.8 percent.

The employment trend in favor of women is a dramatic change from the past and partly reflects the continuing decline of manufacturing.

While men typically see their unemployment rates jump during a recession, Francine Blau, a Cornell University professor of labor economics and labor-industrial relations, said this recession has attacked men in particular.

“Men are more likely to be in cyclical sectors,” said Blau, referring to manufacturing and heavy industrial work. Women are more likely to be concentrated in education and health care, which need workers no matter how the economy is doing and which have become the largest sources of jobs in many areas, including Rochester.

Unemployment tends to lessen with age as well as with education. Women and men in their 40s and 50s are more likely to hang on to their jobs than those in their 20s and 30s, who often are the last hired and first fired when business conditions worsen.

During this recession, though, the jobless numbers are relatively high for more experienced workers.

Racial disparities

What hasn’t changed is that disparities based on factors such as race are still evident. So while white men ages 45 to 54 are seeing a record high unemployment rate of 8 percent, the rate for African-American men in that age range is 13 percent, which isn’t a record.

The solutions to these disparities are long-term, not short-term, and will involve funding for more education and job training, said Zachary Karabell, president of River Twice Research in New York City.

Even the $787 billion federal stimulus spending is a short-term fix that will not repair some of the nation’s structural problems, which have caused higher unemployment for black and Hispanic workers, Karabell said.

Blau said many African-American and Hispanic workers are concentrated in heavy industrial and cyclical sectors and are especially hard hit during a recession. She also noted the exodus of jobs to the suburbs, farther away from city neighborhoods and public transportation routes.

“There aren’t a lot of opportunities,” said Hilda Rosario Escher, president of the Ibero-American Action League in Rochester. She said that many Hispanic workers will eagerly accept work, but the recession has diminished opportunities across the board, even lower-paying positions in restaurants and retail stores.

Awaiting recovery

The recession has left many laid-off workers with solid résumés scratching their heads and hoping for a turnaround. Kevin Hoock is among them.

At Tyco and the plant’s previous owner, Eastman Kodak Co., Hoock managed as many as 160 people at the peak of business, when the plant was shipping 1 million circuit boards a week. Even toward the end, he oversaw 75 employees.

But changing business conditions and then the recession caused the volume of work to decrease, and finally the operation was relocated overseas.

The fact that Hoock is still looking for a job shows the depth of the recession. He has an associate’s degree in business and in 2004 was certified as a forklift trainer — plus he has those 28 years of supervisory and manufacturing experience.

He has derived satisfaction from helping to find employment for at least 12 of his former Tyco colleagues.

When it will be his turn, he doesn’t know.

JFSTINSO@DemocratandChronicle.com

 (From the London Times) Ursula Burns is living the American dream. The 50-year-old who grew up in public housing and started at Xerox as a photocopier engineer is about to take over the company.

Anne Mulcahy, Xerox chairman and chief executive, said yesterday that she would retire as chief executive in July, handing the job to Ms Burns. Ms Burns will become the only African-American woman to run one of the top 150 companies in the Fortune 500.

It has been a slow but steady rise to the top. Born in New York City, Ms Burns earned an engineering degree from Columbia University before joining Xerox in 1980 for a summer internship. She moved into product development and planning and in 1991 became assistant to Paul Allaire, the chairman and chief executive.

By 2000 Ms Burns was a senior vice-president and in 2007 was named president of the company, establishing her as Ms Mulcahy’s chosen successor.

Ms Burns has said previously that she appreciated Xerox’s habit of hiring across diverse groups of people but added that the company never reserved certain jobs for particular ethnicities or genders. More important was that employees “value the success of Xerox more than our own egos”, she said.

She will lead a business in far better health than Ms Mulcahy inherited when she joined in July 2001. At the time, Xerox was close to going bust after being hit by increased competition, accounting scandals and a plunging share price.

Ms Mulcahy, another long-time Xerox employee, cut costs and moved the photocopier and printer-maker into consultancy services and document management systems.

Ms Burns played a key role in Ms Mulcahy’s first year at the helm, during which Ms Burns negotiated with unions to outsource thousands of jobs.

Ms Mulcahy will remain as chairman of the company.

Millions of families experienced economic decline since 2000; households of color hardest hit

New York, NY–As the economic downturn continues, a new report finds that millions of African Americans and Latinos lost economic security between 2000 and 2006, and that more than four out of five are either borderline or at high risk of falling out of the middle class altogether. The new report, “The Downslide Before The Downturn: Declining Economic Security Among Middle Class African Americans and Latinos, 2000-2006″ was published today by the policy center Demos and the Institute for Assets and Social Policy (IASP) at Brandeis University.

“The Downslide Before The Downturn” is based on the Middle Class Security Index, co-developed by Demos and IASP/Brandeis, which uses government data and measures the financial security of the middle class by rating household stability across five core economic factors: assets, educational achievement, housing costs, budget and healthcare. Based on how a family ranked in each of these factors, they were defined as financially “secure,” “borderline” or “at risk”.

 ”The Downslide Before the Downturn” shows some worrying trends in America’s households, including:

• In 2006, before the recession, most US middle class families (76%) were already economically insecure, with only 24 percent experiencing stability across the core Index factors. However, when the numbers are broken down demographically, only 16% of African Americans and 12% of Latinos experienced such security. This is a dramatic decline from 2000, when the national average was 29%, 26% for African Americans and 23% for Latinos.
• In 2006, 88% of Latino and 94% of African-American households lacked sufficient assets to weather a financial emergency, up from 82% and 89% in 2000, respectively.
• The median value of financial assets held by African Americans declined by 33% in the six year period, while those held by Latinos declined by 60% during the same time.
• From 2000 to 2006, median housing costs increased 9% for African American households and 7.5% for Latino households.
• During the same period, the number of families in which at least one member lacked health insurance increased–from 18% to 30% for African Americans and from 26% to 39% for Latinos.

“These results show the precarious position of families who struggle to make it into the middle class amidst policies that do not support broad economic opportunities. Even before things started to slip, African-American and Latino middle-class families were already on weaker footing, a position that sets them up to lose more ground than they can afford in the current economy,” said Jennifer Wheary, one the report’s co-authors and a Senior Fellow at Demos.

“The decline in assets experienced by these families is particularly alarming,” said Tom Shapiro, Professor and Director of the Institute on Assets and Social Policy at Brandeis University. “Most of these families had few assets to start with. With the value of these assets declining just as families need them most, they will not only find it difficult to weather uncertain times. They’ll also experience setbacks that will be felt by future generations. All this points to a need for policies that support asset building even in hard times.”

“The Downslide before the Downturn” is the fifth report in a series based on the Middle Class Security Index. Recent reports in this series examined the economic security of America’s seniors and the overall position of the middle class heading into the recession. In addition to these reports, Demos and IASP/Brandeis have published a Middle Class Security Factsheet that provides information about the broad economic state of the middle class at a glance and a Scorecard that individual families can use to measure their economic stability. To download reports, the Security Scorecard or the Factsheet, visit www.demos.org. To order hard copies or to arrange an interview with one of the authors, please see contact information.

(From the Baltimore Examiner)

The economic downturn has hit everyone regardless of race or religion. Baltimore’s communities are no different. On Monday evening, May 11, a group of thirty blacks and Jews came together for a symposium on Poverty. The event, which took place at the Episcopal Dieses Center downtown,  was sponsored by the Black-Jewish Forum of Baltimore, BLEWS.

“Our topic was how the economic downturn has affected Baltimore African American and Jewish communities,” explained BLEWS president Camay Calloway Murphy. She said the Baltimore Black and Jewish communities have similar backgrounds and social realities as minorities.

“I think it is quite important there be some sort of molding together or understanding,” she said.

There were two keynote speakers at the meeting, which combined with questions and answers ran for about an hour-and-a-half. Those speakers were Diane Bell-McKoy, president of Associated Black Charities, and Barbara Gradet of Jewish Family Services. Gradet spoke about the dramatic increase in the number of people coming for services a result of their being laid off. She said that since Jewish Family & Children’s Services, Jewish Addiction Services and Jewish Vocational Services combined into JFS, just before the recession went into full force, shes seen many people coming in need of all three departments.

McKoy said the African American community is likewise struggling. She noted that the recession has aggravated an already high level of poverty and other socio-economic issues within the local black community. McKoy expressed that 66 percent of African Americans in Baltimore do not have college degrees, whereas 66 percent of local Jews do.

“This kind of statistic brings to mind the question, ‘How did this come about?’ We have to ask, ‘Why is the statistic this way and what can be done to change that, to bring the African American community to have a greater percentage?’” said Murphy.

The speakers also spoke about what the black community can learn from the Jewish community in terms of small business development. Board member Bernard Berkowitz explained, “The tendency is for African American-owned businesses to hire African Americans. In Maryland, most African American-owned businesses are one person businesses. They don’t employ anybody. If there were programs to encourage the growth of these small businesses, the growth would likely have a significant impact on the hiring of African American people.”

BLEWS was founded in 1978, when community leaders feared the Baltimore black and Jewish communities were growing apart. The purpose of the organization, said Berkowitz, is through dialogue to encourage understanding and cooperation between blacks and Jews. The latter, said Murphy, was the main message of the poverty forum.

“The economic downturn is affecting everybody. It is not specific to any one group or level of income,” she said. “The forum opened participants’ eyes to what is happening beyond their small group, it broadened their visions and understanding.”

Author: Maayan Jaffe

Maayan Jaffe is an Examiner from Baltimore. You can see Maayan’s articles on Maayan’s Home Page.

Chrysler has announced plans to trim its number of dealership franchises as a cost cutting measure

  By ALEX P. KELLOGG

Minority car dealers are expected to be hit hard as General Motors Corp. and Chrysler LLC trim their retail networks, undoing years of work by the auto makers to bring more African-Americans, Hispanics and others into the car business.

Chrysler on Thursday said it would drop 789 of its 3,200 dealers as part of its bankruptcy restructuring. GM plans to eliminate 2,600 of its more than 6,000 dealers as it reorganizes.

The National Association of Minority Automobile Dealers estimates that 140 of Chrysler’s 170 to 175 minority-owned franchises could be closed, and at least 174 of GM’s 300 minority-owned dealers could shut their doors.

The organization said Chrysler’s minority-owned dealerships are at risk because many are small stores that offer only one of the company’s three brands, Chrysler, Dodge and Jeep. Fewer than half have converted to the company’s “Genesis” format that puts all three makes under one roof, NAMAD said. That compares to the approximately 60% of all Chrysler dealerships that have the three-brand format.

Genesis stores are usually more profitable because they sell and service more vehicles than single-brand dealerships. Chrysler plans to emphasize Genesis dealerships under its reorganization.

About 58% of the GM stores run by minority owners sell Pontiacs, Saturns, Saabs or Hummers, NAMAD said — all brands the company plans to phase out or sell.

“We’re more vulnerable,” said NAMAD President Damon Lester. “We were the last ones to come to the table.”

Chrysler declined to comment. Dawin Wright, GM’s executive director of dealer development, said GM is trying to put in safety nets to help minority dealers survive. “We share their concern,” he said.

After years of losing market share, GM, Chrysler and Ford Motor Co. have been left with more dealers than they need, especially in metropolitan areas. As a result, their franchises often end up competing with each other for customers and many lose money.

Many minority dealers operate in cramped downtown locations that are less desirable than the spacious suburban auto malls that are now popular, said Mr. Lester and other dealers. Urban franchises typically draw fewer shoppers and carry less inventory for customers to choose among. Both factors tend to limit sales.

Minority dealers often don’t own the land beneath their showrooms, so the monthly rent adds to their costs, Mr. Lester said. And since many borrowed money to get into the business, they sometimes have more debt than family-run dealerships that have been in business for decades.

Sil Gonzales, 57 years old, feared his Casa de Gonzales Chrysler-Jeep store in South Gate, Calif., a largely Latino suburb of Los Angeles, would be one of those Chrysler terminates.

As Chrysler’s troubles have mounted in the past year, his sales have plunged. He’s hoping to sell the six acres of land beneath his store to raise cash to pay off $14 million in debt.

But on Thursday he learned from Chrysler that his dealership had been spared.

“We were very fortunate,” Mr. Gonzales said.  “Now I’m just concerned for my fellow minority dealers.”

 On Wednesday, a delegation of about 100 dealers, including some minorities, gathered in Washington to lobby Congress to save dealerships from closure. On Thursday, representatives of the National Auto Dealers Association, along with NAMAD, were scheduled to meet with the White House’s automotive task force, according to an NADA spokesman.

The Big Three car makers first set up programs to help minority and women entrepreneurs get into the dealer business back in the 1970s and ’80s. The idea was both to increase diversity among their retail networks and do a better job appealing to the growing ranks of minority consumers.

Greg Baranco, an African-American, owns a Buick-Pontiac-GMC store in Atlanta and a Mercedes-Benz dealership nearby. He’s been in the business 30 years, but said he has watched how his Pontiac sales plunged after GM announced earlier this year the brand would be eliminated. After selling 20 Pontiacs a month on average, he sold just four in April.

Mr. Baranco worries how he will do carrying just GMC and Buick. “Dealers are finding it difficult to maintain those operations with just two brands,” he said.

—Kate Linebaugh contributed to this article.Write to Alex P. Kellogg at alex.kellogg@wsj.com

 A study by Essence magazine, in conjunction with Vision Critical Group, shows that African-American women spend nearly twice as much on skin care annually than the general market.

Essence magazine shared the results of its proprietary study, Smart Beauty IV (developed in conjunction with New York-based research firm Vision Critical Group) at the fourth installment of the Smart Beauty series. Presented at the Mandarin Oriental Hotel in New York City, the study focuses on African-American women and the prestige beauty category, and a panelist discussion analyzed the attitudes and purchase behaviors of the modern African-American beauty consumer.

“Essence’s Smart Beauty research confirms that African-American women are confident and aspirational; embracing and celebrating their unique beauty to the fullest,” says Mikki Taylor, beauty and cover director, Essence. “As trendsetters, African-American women enjoy the beauty experience and are loyal consumers, who trust prestige brands to deliver the quality they expect.”

Designed to educate, inform and inspire change in marketing to women of color by identifying their buying power, influence, needs and desires, the research methodology for Smart Beauty IV included online surveys among a national sample of African-American women and general market women, 18-54 years old. The sample of over 1,500 included a mix of women who used branded beauty products and have shopped at a prestige store for a cosmetic, skin care or hair care beauty product in the past six months.

Highlights of Smart Beauty IV:

• Regarding spending power: African-American women spend 80% more on cosmetics annually and nearly twice as much on skin care products than general market women do annually.
• Regarding marketing to African-American women vs. general market women: A a brand she aspires to (48%) is a more important attribute than one with an appealing celebrity endorsement (33%) when choosing a beauty product.
• Regarding the mindset of African-American women: Her self-confidence is evident in describing herself as intelligent, independent, attractive, ambitious, sexy and fabulous more often than general market women.
• Regarding what informs the purchase decision for African-American women: Reflecting her personal style, being a brand she trusts, offering high-quality ingredients and being suited to her needs all stand out as key attributes to compel purchase across cosmetic, skin and hair categories respectively.

WASHINGTON, May 8 /PRNewswire-USNewswire/ — The Independent Women’s Forum, National Black Chamber of Commerce, the U.S. Hispanic Chamber of Commerce and the HR Policy Association launched a new web site today,www.EFCA-Info.org, developed to provide facts and information and to educate small business owners, employees and the middle class about the Employee Free Choice Act (EFCA) under consideration by the U.S. Congress. As part of the work in building the site, the Independent Women’s Forum commissioned a poll of small business owners for their opinions regarding EFCA. The poll, conducted by Lombardo Consulting Group (LCG) found that small business owners believe that EFCA will not only hurt their business in general, but will also hurt their relationship with employees and their ability to provide jobs in their community.

The EFCA-Info web site is accessible to the general public, and the information is aimed at educating those most affected by the legislation — small business owners, employees, the middle class and arbitrators. The site is focused on both the merits and specifics of the legislation and is sponsored transparently by these associations who represent a variety of American businesses, including minority-owned and women-owned small businesses.

Michelle D. Bernard, President and CEO of the Independent Women’s Forum (IWF) said, “Women entrepreneurs are among the fastest growing group of business owners. According to our recent survey, small business owners lack information about EFCA, but what they do understand they do not like. We are pleased to provide our members with this important information.”

EFCA-info.org contains IWF’s small business survey and other new research on how EFCA would affect the middle class and the economy, policy papers and reports on the provisions of the legislation, and fact sheets that explain how EFCA would change current workplace law. The web site also contains simplified explanations of the provisions in the legislation, definitions of the terms used in it, and rebuttals to common misperceptions about EFCA.

“We believe that enacting EFCA and other pro-union legislation will have a very negative impact on the African-American business community, on African-American employment, and as a result, on our economy as a whole. At a time when we should be focused on greater opportunities and more jobs, voting for EFCA is the wrong choice for the African-American community,” said National Black Chamber of Commerce President and CEO Harry C. Alford. “EFCA-info.org provides credible research and useful information about the impact of the Employee Free Choice Act on small and minority business owners.”

In addition to providing facts and information, EFCA-info.org will also offer a way for visitors to voice their opinions about the legislation to their elected representatives through the “Make Your Voice Heard” section. And, by selecting “Get Updates” on the web site, visitors will be notified when new information such as changes in the legislation, press releases and other EFCA-related advisories are posted to the site.

“If we as a nation are interested in economic recovery, job creation, and developing the new technologies and industries of the future – the Employee Free Choice Act is a bad starting point,” said USHCC President & CEOAugustine Martinez. “In the long run, both business owners and employees would suffer. If made law, this bill would boost costs, restrain productivity and make businesses less competitive. Small businesses create nearly 80 percent of all new jobs, much like we produce the vast majority of patents and this legislation would hinder productivity as the small business community becomes a target of labor organizers, strikes and labor agreements,” he added.