Opinion: The unemployed need not apply

This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.

Cue the ominous soundtrack and over-earnest narration. No, really -- this is a terrible story:

Out of work since December, Juan Ochoa was delighted when a staffing firm recently responded to his posting on Hotjobs.com with an opening for a data entry clerk. Before he could do much more, though, the firm checked his credit history.

The interest vanished. There were too many collections claims against him, the firm said.

“I never knew that nowadays they were going to start pulling credit checks on you even before you go for an interview,” said Mr. Ochoa, 46, who lost his job in December tracking inventory at a mining company in Santa Fe Springs, Calif. “Why would they need to pull a credit report? They’d need something like that if you were applying at a bank.”

Once reserved for government jobs or payroll positions that could involve significant sums of money, credit checks are now fast, cheap and used for all manner of work. ... But job counselors worry that the practice of shunning those with poor credit may be unfair and trap the unemployed — who may be battling foreclosure, living off credit cards and confronting personal bankruptcy — in a financial death spiral: the worse their debts, the harder it is to get a job to pay them off.

Whole enraging, armed-revolt-inspiring article from the New York Times here.

Or, if you’re into the whole brevity thing, here’s a short version of the NY Times’ story: In this recession, when individual credit scores are likely to take major hits, more companies are using credit histories as a quick way to whittle down growing pools of applicants, thereby perpetuating a vicious cycle -- and few states are doing anything about it.

Before you get overcome with rage, realize that the NY Times provides zero statistics to prove this problem is really an epidemic, relying instead individual anecdotes from down-on-their-luck Juan Ochoas and job counselors. It’s certainly not enough evidence to provide the groundwork for legislating more restrictions on the hiring and firing decisions of private companies, a move that certainly wouldn’t help their efforts to grow and power economic recovery. Besides, I’m inclined to think their heartless human resources departments know better than the part of my brain given to populist sympathizing what red flags on a background check indicate potentially risky behavior in the future.

But really, these kind of despairing credit-check job rejection represent the kind of insensitivity that inspires the masses to grab the pitchforks, light the torches and storm the bastille -- or worse, vote for John Edwards and watch Lou Dobbs. The same goes for the board-room suits that freeze salaries or lay off workers while handing their executives handsome bonuses. It’s greedy, tone deaf and sinful to the point that there ought to be a circle of hell set aside for those who practice it. But it shouldn’t be illegal, and the offending businesses may want to consider improving their public image.

What are your thoughts? Should the feds and state governments curtail such such seemingly irrelevant pre-employment credit checks, or should laissez faire economic principals prevail? Take our poll, leave a comment or both.