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JewishJournal.com

October 31, 2002

Middle-Class Poor

A growing number of poor Jews is taxing the capabilities of charitable services.

http://www.jewishjournal.com/community_briefs/article/middleclass_poor_20021101

The Jewish immigrant from South Africa had lived the American dream since he arrived in the United States 14 years ago.

Juggling import-export and computer consulting jobs, the 42-year-old Culver City resident had earned an average of $125,000 per year, enough to send his two young children to private Jewish school and support his wife. Life was good, with lots of meals out, family outings to Knott's Berry Farm and plenty of company for Shabbat meals.

But like many members of the middle class, the busy professional -- who declined to give his name for this article -- suffered a major financial blow as the economy faltered. Over a year ago, an import-export firm for which he subcontracted failed to pay him a $65,000 commission.

Suddenly, his financial security evaporated, and he quickly fell behind in his children's tuition payments. His marriage grew strained. Nights were sometimes sleepless.

When the Jewish school recently barred his 13-year-old daughter and 9-year-old son from attending classes until he brought the account current, the proud father did something he never imagined himself doing: He turned to charity. Borrowing $15,000 from family members abroad and $5,000 from the Jewish Free Loan Association (JFLA), a beneficiary agency of The Jewish Federation of Greater Los Angeles, he paid off most of the school debt and re-enrolled his children.

"The need for my kids to be happy and to protect their little world outweighed any shame and distress I felt," he said. "Still, asking for money was gut wrenching."

With the stock market limping, unemployment mounting and the economy softening, many Jews who benefited from the go-go '90s have suddenly found themselves hurting. For some, private school tuition, temple fees, bar mitzvahs, along with the need to keep up with the Cohens, has made their situation even worse.

For the poor, tough times have forced many down a rung or two on the economic ladder. With rents skyrocketing and salaries stagnating, some families have been forced to pile into one-bedroom apartments or illegal converted garages.

For the well-off, adjusting to the new and ugly reality has been less dramatic but still painful. Vacationing overseas and purchasing luxury items have been deferred. Neiman Marcus is out; Target is in.

That the rich should weather a tough economy better than indigent immigrants or senior citizens living on a fixed-income is no surprise. However, the turbulent economy appears to have hit the middle class and lower-middle class harder than expected. Several charitable Jewish groups like JFLA have noticed an upsurge in demand for services, not just from the poor, but from struggling professionals as well.

Once high-flying computer programmers, travel agents and small business owners are increasingly applying for free groceries, career counseling and interest-free loans as their jobs and incomes have dried up in the post-Sept. 11 environment.

Although no recent statistical data exists on Los Angeles County's Jewish poor, a 1997 survey conducted for The Federation by demographer Pini Herman for found that 9.4 percent of Jews in the region earned less than $10,000 per year (the survey area covered about 95 percent of the county). Jewish poverty rates may have declined slightly since then, because some of the elderly have died. But the weak economy has undoubtedly plunged thousands of Jews into poverty, including unemployed and underemployed professionals, Herman said.

"We're seeing more two-parent working families and others who never expected to need services from the community," said Leslie Friedman, director of the SOVA Food Pantry Program. "Many people are finding they can no longer stretch their incomes."

Overcome with embarrassment, the middle-class poor show up to SOVA in shock, stunned that they must seek a handout, she said.

SOVA, which gives clients a four-day supply of groceries every month, served 19,834 people in the first eight months of the year, 1,300 more than in the same period in 2000, Friedman said.

Claudia Finkel, COO of Jewish Vocational Service (JVS), a beneficiary agency of The Federation, said the number of people dropping by its offices for job training and leads has skyrocketed by 50 percent over the past year. Among those anxious to find work are recent college graduates unable to break into the job market and elderly retirees who have seen their retirement savings decimated by their plunging stock portfolios, she said.

So many laid-off young professionals and those with newly minted master's degrees need help landing a decent position that JVS just inaugurated a program, FasTrak, tailored to meet their needs.

Since the beginning of September, the nonprofit has offered three three-hour seminars on subjects ranging from networking, goal setting and the need to "self-brand," Finkel said. The FasTrak gatherings have proved so popular, that JVS plans to roll out a new series early next year.

For now, many recent grads and jobless professionals under 30 are moving back in with mom and dad or taking positions in low-paying fields in which they have little or no interest.

"They were promised a golden ring with an MBA or a law degree, and they haven't gotten one," Finkel said. "I think there's a state of shock."

Shana Portigal would agree. The 27-year-old just earned an MBA from Tulane University with a concentration in marketing. With $75,000 in school debt, she hoped to land a high-paying brand-management job to pay off her loans.

Returning to the Southland after graduating in May, she moved in with her mother and sister to save money and soon began hunting for work. Despite her degree and past experience as a marketing director at a radio station, Portigal said she generated few good leads. To get an edge, she went to several networking events and a FasTrak seminar.

Frustrated, she eventually took an administrative job at a major studio for about half of what she expected to earn, although she hopes eventually to parlay that into a marketing position.

"If I would have known it would be so hard to find a job, I would have put off going to graduate school," she said.

For nearly 100 years, the Jewish Free Loan Association of Los Angeles (JFLA) has been making interest-free loans to those in need in accordance with biblical pronouncements. But with donations off by nearly $900,000 compared to last year and demand up, the nonprofit, nonsectarian organization recently had to suspend graduate school and some business loans until next year -- the first time JFLA ever took such drastic action, said Mark Meltzer, the group's CEO.

Already, about a dozen graduate students have been turned away. Before suspending loans, the outfit slashed them from a maximum of $5,000 per person to $3,000 earlier this year .

If JFLA's fundraising doesn't pick up in the next few months, that could translate into fewer or smaller loans going forward, Meltzer said. Also, the association might have to layoff at least one of its 10 employees early next year.

As requests for emergency loans for rent and food continue to mount, Meltzer worries that the economic outlook for many middle-class and less fortunate Jews could darken.

"We're just seeing the tip of the iceberg," he said.

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