Severance Economy Next Shoe to Drop?

By
Photo: iStockphoto; Jed Egan

Like the soft-bellied dinosaurs caught flat-footed by the great extinction event, some of the people laid off during the Greatest Depression have been unable to adjust to their new environment. They've just kept on living as before, gulping down their severance pay in the form of so many Pumpkin Spice lattes, and now, many of them are left holding empty cupfuls of grounds.

Like Chuck Hipsher, a former New York adman who, along with his wife, was laid off and received $60,000 in severance benefits.


Mr. Hipsher says the family continued to spend like before. They moved with three cars — two BMWs and a Chevy Silverado. They continued to buy cases of $36-a-bottle wine. They spent $250 a month on a cleaning lady, and Mr. Hipsher dropped $50 a week on flowers for his wife. The couple still dined out regularly.

"We were stupid," he says. "You become accustomed to a certain lifestyle. When your world changes and things dictate that you change, you're pretty stubborn to give things up."

Now, Hipsher tells the Journal, "We have $600 to our name." Which is more than we have, but still.

Life on Severance: Comfort, Then Crisis [WSJ]