Older workers are generally less likely to lose their jobs than younger employees. But new research suggests that this older worker employment advantage is due mostly to spending more time with their current employer. Once you control for job tenure, older employees are actually more likely to lose their jobs than younger workers, according to a new Urban Institute analysis of Census Bureau data. Here’s a look at what keeps workers employed after age 50.
[See 10 Key Retirement Ages to Plan For.]
Build up seniority. Older workers are generally better at holding on to their jobs than younger employees. Between 1996 and 2007, men age 50 to 61 were 21 percent less likely than those age 25 to 34 to be laid off each month. However, when time spent with a single employer is held constant, the older worker employment advantage disappears. “The protective effects of age derive solely from older worker’s seniority with their employers,” write Richard Johnson and Corina Mommaerts, the authors of the report. Once job tenure is factored in, men age 50 to 61 are 24 percent more likely than those age 25 to 34 to lose their jobs.
The ideal amount of job tenure is at least 4.6 years of service, the Urban Institute calculated. “Our results indicate that a worker in his fifties with less than 4.6 years of job tenure is more likely to become displaced than an otherwise identical newly hired worker in his late twenties or early thirties,” according to the paper. “A 55-year-old worker with more than 4.6 years of job tenure is less likely to lose his job than the younger new hire.”
[See 30 Fast-Growing Careers for Older Workers.]
Prepare for a long job search. Once older workers lose their jobs, they generally have more trouble than their younger counterparts finding work. While 70 percent of laid off workers between ages 25 and 34 were able to find a new job within six months, only 58 percent of unemployed workers age 50 to 61 found new employment in the same amount of time. Unemployed men age 50 to 61 are 39 percent less likely to be hired each month than men age 25 to 34. “Employers may fear that they will not have time to recoup hiring and training costs before older new hires retire, or they may worry that older workers are less productive than younger workers,” write Johnson and Mommaerts. “Many employers also express concern that older workers are more expensive than younger workers, because of rigid seniority wage structures or because health and pension benefits are more expensive at older ages.”
You might need to accept lower wages. When laid off older workers find new positions, they are typically paid much less at the new job. Men who become reemployed between ages 50 and 61 earn a median wage that is 20 percent less than their old job paid. For those reemployed at age 62 or older, the new median wage falls 36 percent below the salary at their former job. “Earnings may fall sharply for older workers because the human capital they developed on their old job was specific to that particular firm and not readily transferrable to other employers. Or the wage losses may reflect employer reluctance to hire older workers,” according to Johnson and Mommaerts. In contrast, laid off employees between ages 35 and 49 who found new jobs experienced median wage declines of just 4 percent.
[See 7 Tips for Working for a Younger Boss.]
Use multiple job search methods. For most unemployed workers age 50 to 61 (72 percent), job hunting involves contacting employers directly by sending them a resume or job application and going for interviews. The next most common job search methods include looking at job advertisements (31 percent), asking friends and family (31 percent), and contacting public employment agencies (21 percent). Strategies underutilized by older job seekers include contacting private employment agencies (9 percent), checking professional or union registers (5 percent), and contacting school employment centers (3 percent). Individuals in their 50s utilized a greater diversity of these job search strategies than any other age group. However, 50-somethings only used an average of two of them.
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tom of NY 7:59PM January 27, 2011
Bette Boomer of MT 1:52PM January 14, 2011
LoveBeingRetired of CA 11:46AM January 14, 2011