Out in the Cold

Posted Wednesday, October 30th, 2013| Comments (4) rule
Why there are still millions of unemployed older workers, and what the U.S. should do about that
Carl E. Van Horn' s photo
Carl E. Van Horn, PhD
Professor of Public Policy, Edward J. Bloustein School of Planning and Public Policy
Director, John J. Heldrich Center for Workforce Development
Rutgers, The State University of New Jersey

Research Fellow, Sloan Center on Aging & Work, Boston College
Email: vanhorn@rutgers.edu

Being unemployed is frustrating, demeaning, and…frightening. Articles in the paper say we “baby boomers” will have to work for a few more years, especially since so many of us have lost half if not more in retirement “funds.” Now, you tell me, how can I work for a few more years if I can’t even get a job interview?
— Older unemployed worker quoted in Working Scared (Or Not At All): The Lost Decade, Great Recession, and Restoring the Shattered American Dream (Rowman and Littlefield, 2013).

During and after the Great Recession, millions of older unemployed workers struggled to regain a toehold in the labor market. A staggering percentage of the unemployed over age 50 (estimated on the basis of a nationally representative sample tracked from 2009 to 2011 by the Heldrich Center for Workforce Development) were jobless for a long time. In 2011, we re-interviewed workers who lost their job during the depth of the recession in 2009: 80 percent had been searching for more than a year, and almost half had been jobless for more than two years.

Today, more than 2 million older Americans who would work if they could are jobless. Extensive national surveys of older displaced workers provide overwhelming evidence that the vast majority are unemployed for two reasons: workforce demand overall is depressed and employers typically seek younger workers. Extensive national surveys of older displaced workers, including recent research featured in The Atlantic, makes it clear that the stigma of long-term unemployment suffered by older Americans is killing their prospects for reemployment.

Older workers’ long-term unemployment experience is not due to their lack of effort to find another job. In fact, the vast majority of those interviewed by the Heldrich Center for its “Work Trends” surveys diligently sought work, by scouring ads and online job postings and by contacting friends, family, and potential employers.

Nor did these older Americans remain jobless because they refused to work for less money. Two out of three unemployed respondents told Heldrich Center researchers that they would accept a pay cut to land a position. “Work Trends” surveys revealed that six in ten reemployed older workers earned less than they had previously, and 14 percent earned less than half as much.

The especially bleak job prospects for older workers in a generally poor labor market are the by-product of employers’ perceptions about mature workers. Too many employers assume that older workers are more expensive, less productive, and less flexible than younger employees. Employers fret that older workers’ skills have atrophied during months and years of unemployment. Employers may also be reluctant to hire workers who have less than a decade remaining in their careers. Gary Burtless, a scholar at the Brookings Institution, found scant evidence that an aging workforce has hurt U.S. productivity. Even so, employers’ negative views about older workers linger.

Thousands of older workers realize that in order to land another job they need additional education and training. Yet, Heldrich Center research found that few have been able to do so. According to the Center’s surveys, only 14 percent of unemployed workers were enrolled in programs to upgrade their skills and less than 38 percent got financial help to participate in such programs from government sources.

Contemporary workforce development policies are not well-suited to the needs of the long-term unemployed, according to reports by the U.S. Government Accountability Office and the Council on Adult and Experiential Learning. This is especially true for older workers, who may be able to get another job only after extensive retraining. Unfortunately, the federal government’s principal strategies for assisting unemployed workers consist of partial income replacement through unemployment insurance, job placement services, or short-term training programs.

Many policy makers are ignoring older unemployed Americans. Others blame them, discounting the prodigious efforts most make to find jobs. It’s time for policy makers to redesign and fund the workforce and education programs that older unemployed people desperately need so they can return to work.

4 responses to “Out in the Cold”

  1. Frank Hoffman says:

    Wow! Did you hit a “hot button” with me. As a retired Deloitte Director (and a SENIOR Advisor to the Sloan Center on Aging and Work), followed by a one-year stint as a practicing lawyer with a well-regarded medium-large law firm in Metropolitan Detroit, I am one of the frustrated many who have searched and applied for many open opportunities, locally as well as nationally to no avail. On the one hand articles abound about retirement income planning, and deferring “social security retirement” age until 70 to maximize the distribution amount, etc. However, where’s the correlation or at least recognition that we who love to be in a position to that, do not have the wherewithal to make those decisions. Believe me, I feel competent and healthy enough to be of significant value to any organization, with flexibility about compensation to boot. Having spent some of my Deloitte time researching aging in the workplace issues, I’m a firm believe that if employers gave this cohort an opportunity, the fit and productivity that it would receive would be well worth it. Thanks for allowing me this forum.
    Frank Hoffman

  2. While I agree that older workers may have to overcome the challenges that Dr Van Horn describes I have also found that when properly prepared our clients (we do outplacement and career counseling) do find meaningful work in a reasonable amount of time and often do not take a hit in status or income. People need to understand their strengths and how to market them and how to frame the conversation, spoken and written, with perspective employers so that their experience is framed as an important benefit to an employer.

  3. Janet says:

    So many of my 55+ cohort colleagues who were terminated in 2009 have yet to find work. Most of these were employed in financial services as “business development officers,” “investment advisors,” “research analysts” or “portfolio managers.” I know many who are piecing together low-paying, short-term gigs and living on the gifts of friends and family. Others “pay” to work by volunteering many days each week. Most have earned their masters; a few, doctorates. They need wages to live above subsistence.

    The solution would seem to be a Senior Service Corps, with some kind of stipend and/or benefit. We’d be dead by the time this would materialize!

  4. We definitely agree that it’s time for policy makers to redesign and fund workforce and education programs for older unemployed people. But both federal and state age discrimination in hiring laws also need to be tightened and more strictly enforced. A new national discussion about ageism in the American workplace needs to occur now–46 years after the enactment of the Age Discrimination in Employment Act (ADEA).

    More jobs will not exist for all unemployed job seekers, including older ones, until the current $800-$900 billion shortfall in total demand within the U.S. economy is substantially narrowed through constructive, demand-oriented fiscal policy.