OLDER WORK­ERS GET WISER More Amer­i­cans are de­lay­ing re­tire­ment, but find­ing jobs later in life isn’t so easy

Austin American-Statesman Sunday - - JOBS -

about 37 weeks, com­pared with 25 weeks for work­ers ages 35 to 44, ac­cord­ing to 2017 data from the Bu­reau of La­bor Sta­tis­tics. Their hourly pay also starts to de­cline as they en­ter their 60s, re­gard­less of how much ed­u­ca­tion they have.

“We are liv­ing longer. We are liv­ing health­ier. We want to work,” said Su­san We­in­stock, vice pres­i­dent of fi­nan­cial re­siliency for the AARP. “We have this la­bor short­age, and we hear about the skills short­age. Older work­ers can fill those needs if em­ploy­ers will open them­selves up to the idea.”

Why work longer?

Chang­ing de­mo­graph­ics and com­pen­sa­tion for older Amer­i­cans have been up­end­ing the re­tire­ment land­scape since the mid1990s.

In a re­ver­sal of a decades­long trend to­ward ear­lier re­tire­ment, work­ers 55 and older made up 22.4 per­cent of the work­force in 2016, up from just 12 per­cent two decades ear­lier, ac­cord­ing to the U.S. Bu­reau of La­bor Sta­tis­tics. By 2026, when baby boomers will be 62 to 80 years old, that share is ex­pected to rise to 25 per­cent.

Work­force par­tic­i­pa­tion also has risen sharply, with about 40 per­cent of peo­ple ages 55 and older ei­ther work­ing or ac­tively look­ing for work to­day, com­pared with 30 per­cent in 1996. In a sur­vey last year by the Transamer­ica Cen­ter for Re­tire­ment Stud­ies, more than half of re­spon­dents said they plan to work past age 65 or do not plan to re­tire.

Econ­o­mists of­fer mul­ti­ple the­o­ries about what is driv­ing peo­ple to work longer, in­clud­ing im­prov­ing health, higher ed­u­ca­tion and a shift to­ward less phys­i­cally de­mand­ing jobs.

The grad­ual phase­out of tra­di­tional em­ployer pen­sions and a cor­re­spond­ing rise in more volatile 401(k) plans have also dis­cour­aged ear­lier re­tire­ments. At the same time, an in­crease in the So­cial Se­cu­rity full re­tire­ment age (now 66 and ris­ing) has in­duced peo­ple to stay in the work­force longer by re­ward­ing them with higher monthly pay­ments.

“There is a whole set of peo­ple who have never re­ally re­cov­ered from the Great Re­ces­sion,” AARP’s We­in­stock said. “If your re­tire­ment ac­counts took a hit at that time, it has only been 10 years, and it takes a life­time to build up those re­tire­ment ac­counts.”

Work­ers 55 and older have been the fastest-grow­ing seg­ment of the U.S. la­bor force since 1996, and that trend is ex­pected to con­tinue through 2026, ac­cord­ing to the Bu­reau of La­bor Sta­tis­tics. At the same time, the growth rates for younger age groups aren’t pro­jected to in­crease much over the next decade.

And as Gary Burt­less, a se­nior fel­low in eco­nomic stud­ies with the Brook­ings In­sti­tu­tion, noted, there are also some peo­ple who simply like their jobs and aren’t ready to stop work­ing.

Lower wages

Af­ter 35 years in the con­struc­tion in­dus­try, David Sap­per, now 64, said it felt like a “punch in the gut” when he lost his highly paid man­age­ment job as part of a down­siz­ing seven years ago.

Rec­og­niz­ing he would have to set­tle for pay well be­low his pre­vi­ous six­fig­ure salary, he spent nearly a year look­ing for work be­fore tak­ing a job he hadn’t en­vi­sioned for him­self — and that pays much less than his old one.

Wage data as­sem­bled by the Fed­eral Re­serve Bank of At­lanta show av­er­age hourly pay for full-time work­ers start­ing to de­cline af­ter age 60 across all ed­u­ca­tion groups. Those sta­tis­tics, though, are only for full-time em­ploy­ees and there­fore don’t re­flect the part-time work many older work­ers typ­i­cally take, ei­ther by choice or ne­ces­sity.

For the last six years, Sap­per has been a car­a­van driver for San Diego Zoo Sa­fari Park, es­cort­ing vis­i­tors on tours that in­clude close-up views of gi­raffes, rhi­nos and an­telopes. Since join­ing the park, he has worked his way up to nearly 40 hours a week, earn­ing $45,000 to $50,000 a year, he said.

Sap­per ac­knowl­edged that his wife’s job as a school ad­min­is­tra­tor en­abled him to take a sig­nif­i­cant pay cut, but he also said work­ing at Sa­fari Park has meant much less stress in his life.

“I can now fi­nally sleep at night and go to work happy and not be walk­ing through the door dread­ing how am I go­ing to make up for a half-mil­lion-dol­lar over­run on a con­struc­tion job,” he said.

El­lyn Terry, eco­nomic pol­icy spe­cial­ist with the At­lanta Fed­eral Re­serve Bank, sur­mises that one rea­son for the drop in pay that some work­ers ex­pe­ri­ence as they age may have to do with re­duced pro­duc­tiv­ity.

“There’s eco­nomic the­ory that says prime pro­duc­tiv­ity de­clines close to the end of our ca­reers,” she said. “Pro­duc­tiv­ity is gen­er­ally as­so­ci­ated with wages; that is, the more you can pro­duce, the more you will get paid. Lower wages among older in­di­vid­u­als may also re­flect peo­ple switch­ing to less in­ten­sive jobs.”

She is less con­vinced, though, that the data sug­gest age dis­crim­i­na­tion.

“An econ­o­mist would ar­gue that age dis­crim­i­na­tion should not ex­ist, that when an em­ployer wants the best per­son at the best price they’re not go­ing to willy-nilly use age un­less it’s re­lated to some­thing else cor­re­lated with worker pro­duc­tiv­ity and they have noth­ing else to go on,” Terry said.

Try­ing to prove bias

Greg Locke, 60, says he saw signs of bias while look­ing for work re­cently. Af­ter 21 years in the Marines, Locke earned a mas­ter’s de­gree in busi­ness man­age­ment from San Diego State and started a sec­ond ca­reer work­ing for San Diego County in the early 2000s.

In June of last year, he re­tired as a real es­tate telecom­mu­ni­ca­tions devel­op­ment project man­ager, took a few months off and then be­gan look­ing for work again. Dur­ing a few of the six in­ter­views he had, Locke said, he was asked how he would in­ter­act with younger work­ers.

“I have to won­der if younger work­ers were also asked how they would in­ter­act with older work­ers,” he said. He even­tu­ally landed a job with a com­pany that didn’t ask that ques­tion.

Prov­ing dis­crim­i­na­tion is dif­fi­cult, es­pe­cially in in­stances where some­one does not get hired for a job and age bias is the sus­pected rea­son. Of­ten cited as ev­i­dence that age dis­crim­i­na­tion does in­deed ex­ist is re­search con­ducted by a trio of econ­o­mists who in 2015 sent out some 40,000 ap­pli­ca­tions with fic­ti­tious re­sumes for about 13,000 largely low-skilled po­si­tions, such as re­tail sales clerks, jan­i­tors and ad­min­is­tra­tive as­sis­tants. The re­sumes were nearly iden­ti­cal ex­cept for age and gen­der.

It turned out that call­back rates were higher among younger ap­pli­cants than their older counterparts, pro­vid­ing “com­pelling ev­i­dence that older work­ers ex­pe­ri­ence age dis­crim­i­na­tion in hir­ing in the lower-skilled types of jobs the ex­per­i­ment cov­ers,” the au­thors said.

In­stances of age dis­crim­i­na­tion were most no­tice­able among older women, said coau­thor David Neu­mark, eco­nom­ics pro­fes­sor at UC Irvine and a vis­it­ing scholar at the Fed­eral Re­serve Bank of San Fran­cisco.

Still, Neu­mark said proof of dis­crim­i­na­tion re­mains elu­sive. “My point is simply, it’s com­pli­cated,” he said. “It’s bet­ter to be an older worker now than it was in 2010, and it’s bet­ter to be a black worker and an ex-felon be­cause em­ploy­ers have fewer work­ers to choose from to hire. But it’s about the em­ploy­ment cy­cle, so right now it’s a lit­tle eas­ier for these work­ers find­ing work, but we’re at the end of a very long re­cov­ery.”

There re­mains a strong per­cep­tion among the gray­ing work­force that their age is work­ing against them. A 2017 sur­vey com­mis­sioned by AARP found that 3 in 5 work­ers older than 45 have ex­pe­ri­enced or seen age dis­crim­i­na­tion in the work­place.

Mean­while, the lead­ing edge of the baby boom gen­er­a­tion — some 76 mil­lion peo­ple born be­tween 1946 and 1964 — is now 72 years old. “Ten thou­sand baby boomers are re­tir­ing every day,” AARP’s We­in­stock said. “That’s a com­pany’s in­sti­tu­tional knowl­edge walk­ing out the door.”

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