Older Workers’ Employment Status Debated

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Do they rob younger generations of jobs, or are they in the same boat? 

True or false: Older people who refuse to retire are stealing jobs from younger workers.

Reality or myth: Well-educated older workers aren’t finding it any easier to land jobs than less educated ones.

Although the recession left all Americans competing for fewer jobs, it’s debatable which types of Americans are now finding it hardest to regain their employment footing. Some studies maintain that because retirement-age Boomers are staying in their jobs, younger workers are being squeezed out of the job market, but other economists call this bunk.

Some reports indicate that women in their 40s and 50s are finding it harder than men of the same age to land work. And others claim that no amount of education is making it easier for older out-of-work Americans to find employment.

The AARP Public Policy Institute called the end-of-2013 employment figures for older Americans “disappointing”: The unemployment rate for workers ages 55 and older, which had fallen sharply in November, rose in December to 5.1 percent from 4.9 percent, based on U.S. Department of Labor statistics. 

What those numbers mean, and the socioeconomic dynamics behind them, are a source of debate among academics, authors and economists. Some say that older Americans take longer to find jobs because they want the stature or pay they previously had; others assert that they’ve grown discouraged and have stopped looking; still others claim that many employers cling to stereotypes about older workers, not the least of which is that these applicants are “overqualified” for positions.

“You’re not supposed to judge someone by their age but by their skills and characteristics, such as education, job experience,” said Heidi Hartmann, president of the Institute for Women’s Policy Research (IWPR). “Just assuming that because someone’s older that they can’t work at your firm, that’s considered discrimination. It’s easy to get away with, but that doesn’t make it right.”

Hartmann, co-author of the IWPR study How Education Pays Off for Older Americans, contends that the more educated an older worker is, the longer that person will stay in the workforce. She said workers with postgraduate degrees will, after age 65, earn three to five times what someone with a high school education will.

One reason for that, Hartmann explained, is that occupations requiring high levels of education tend to be less physically demanding than those requiring less schooling. This means that advancing age and physical decline don’t affect the livelihood of an educated older worker as much as that of her less educated counterpart. 
Hartmann said her report did show that at older ages, more women with only some college education are working than women who’ve completed their bachelor’s degrees.

“It may be the case that the husbands [of women with college degrees] are making good money or have good retirement policies, so [the women] can work less after retirement age,” Hartmann said in a phone interview. “Another reason may be that older women are more likely to be doing family care than older men.”

MIT professor Ofer Sharone would probably disagree.

In his new book, Flawed System/Flawed Self: Job Searching and Unemployment Experiences (University of Chicago Press, 2013), Sharone concludes that older well-educated workers who’ve been laid off aren’t finding jobs more easily than older people with less education. The book describes how, after several months of searching, unemployed workers who are 40 and older often consider positions that may not use their full range of expertise and that pay less than their previous job, only to be turned down by employers who, directly or indirectly, convey concerns about overqualification.

“It’s not necessarily harder for older college-educated Americans who have been laid off to find jobs than for those with less education,” Sharone said during a December 2013 interview with the Harvard Business Review blog. “The surprising fact is that it’s not easier for them. Once laid off, the likelihood of becoming long-term unemployed is just as great for those with a college education than for those without.”

There may be several explanations for this: Businesses may buy into stereotypes about older workers—that they aren’t terribly energetic, for instance, or are less able than younger people to use new technologies. They may also believe that workers with long resumes and former lofty titles will dislike taking a position that pays less or comes with less responsibility and, thus, will seek to leave at the first opportunity.

“It is almost always older workers who are trapped by perceived ‘overqualification,’ ” Sharone said in the blog interview. “One of the cruelest aspects of how our labor market currently works is that one’s past hard work and successes can become the very thing that keeps one from finding a new job.” 

Robbing Young Workers of Jobs?  

April Yanyuan Wu, a research economist at the Center for Retirement Research at Boston College, co-authored an October 2012 paper that turned conventional thinking on its head by concluding that older people who stay in the workforce later in life aren’t stealing jobs from young people.

In the paper—"Are Aging Baby Boomers Squeezing Young Workers Out of Jobs?"—Wu and her colleagues sought to debunk the so-called lump-of-labor theory, which dates back to 1851. The theory presumes that if a group enters the labor market—or, in this case, group members remain on the job beyond their normal retirement date—people not in the group will be unable to gain employment or will have their hours cut. The theory was used during the U.S. immigration debate and in Europe to validate early-retirement programs.

Wu argued that, when women began entering the workforce in greater numbers, it didn’t result in fewer jobs for men; rather, the economy simply expanded. The same is true with older workers, she said.

“If we buy this untruthful argument about older workers squeezing out younger workers, it might make [older workers’] job prospects even harder,” Wu said in a phone interview. “If employers are thinking, ‘If we keep this older worker, there would be less opportunity for a younger worker,’ it might make their view of older workers worse.”

Steve Spires, managing director of outplacement solutions at BPI group, a global management and HR consulting firm, said that in the current postrecession economy, “there is no one, simple reality.” His experience has been that those over 55 are getting jobs at about the same rate as those between 45 and 55.

“We tend to hear complaints from those under and over 55 that the ‘other’ takes their jobs; the reality is that both are right,” he said in a phone interview. “There are fewer jobs today than there were pre-recession, so somebody else is taking the job that someone else may want. The pie is smaller, and that’s the tough thing that we all are having a hard time dealing with.

“The economy we’re in is like no other,” Spires continued. “In some geographies very few workers are having trouble getting jobs at any age. In other regions it’s the opposite. Maybe older workers have decided it’s just too much work and they’ll just give up. And the younger workers are also saying it’s too hard, deciding to just live at home and wait this out.”

One thing he’s noticed is that women in their 40s and 50s are finding it harder to land jobs than men of the same age. 

“So much has to do with their willingness to relocate and the skills and background they’ve acquired,” said Spires, whose firm prepares women for job interviews. 
 
“One thing we’ve sometimes seen is women dress to appear younger when it’s best to just be who you are. Sometimes, the tone that women can convey in interviews can hurt them: It’s passive, or they tend to ask questions instead of answering questions, or they finish their answers with an upward tone, as if looking for agreement about their answer.”
 
 
Dana Wilkie is an online editor/manager for SHRM. 

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