Been out of a job for nearly 16 months now. Virtually no jobs within the industry that I have 30+ years of experience in. Starting over in another verticle at my age is not easily accomplished. Have encountered the same situation where an employer will only consider hiring someone who is currently employed. I am doing some consulting but that doesn't really count - seems like everyone who is unemployed eventually becomes a consultant. Most in HR know that as well.
Here's a CNN article about the same, and some tips on how to get around it.
In the job hunt, the stigma of being laid off is hard to erase - CNN.com
Good luck to all seeking employment, it really does suck.