Today, of course, employers are in the driver's seat when it comes to finding a job. Millions of people have been out of work a long time. Millions more have become so frustrated about not being able to find a job that they've stopped looking and temporarily left the labor force. They will flood back into the market as job prospects brighten, which has been a theme of recent economic forecasts.
[See 10 Seniors Thriving in Encore Careers.]
As this happens, employers will find older employees grateful for the chance to work. But after three years of a tough job market, seniors who find themselves in demand will also be looking for different types of job opportunities, including telecommuting, flexible hours, and even seasonal, "on-again-off-again" jobs.
"Delaying retirement is often viewed as the surest route to financial security in old age," notes recent research from the Urban Institute, a Washington think tank. "By working longer and earning more, older workers can accumulate additional Social Security, boost savings, and shrink the period their retirement savings must fund. Employment at older ages also expands the nation's labor pool, accelerating productivity, increasing national income, and raising living standards for both workers and retirees."
Before we can all dance into these enticing sunset years, however, older workers must be able to find jobs. The record to date indicates that they might not be able to do so. And the common remedies—stepped up training, senior-friendly jobs and work sites, and stronger efforts to battle age discrimination—are really not in place.
Americans, of course, have not all experienced the same economic fate since the Great Recession. For many older workers, investment losses devastated 401(k)s and made retirement out of the question for years. These folks have fallen into different groups. Some older people with jobs simply continued to work, helping to drive up their share of the employed population to record highs. According to an Institute research project and other groups, employees ages 50 and older have been able to hang onto their jobs better than younger workers, most often because they have more job seniority and experience.
[See 5 Big Money Uncertainties for Retirees.]
Workers older than 50 who have lost their jobs have followed other paths. Many who have not been able to find work again decided to take Social Security as soon as they could, at age 62. This has provided them current income but, ironically, is likely to worsen their long-term retirement prospects. That's because Social Security benefits rise by about 8 percent annually for each year benefits are deferred from ages 62 to 70.
Older job seekers who have found new jobs have often taken big pay cuts. "For men reemployed at age 62 or older, the new median wage fell 36 percent below the old," the Urban Institute reported. "By contrast, median wages fell only 4 percent for reemployed men age 35 to 49 and 2 percent for those 25 to 34."
More likely, accepting a big pay cut was preferable to not finding work. And that's been the fate of many seniors. "Older workers are less likely to be laid off than younger workers, but when they do lose their jobs, they find it much more difficult to find work," says Richard Johnson, an author of the Institute's recent work on older employees.
"Workers age 50 to 61 who lost their jobs between mid-2008 and the end of 2009 were a third less likely than those age 25 to 34 to find work within 12 months," the study found. "Those age 62 or older were only half as likely."
In a study late last year, the Sloan Center on Aging & Work at Boston College analyzed the ways unemployed workers of all ages tried to find new jobs. It did not report correlations between specific job-finding methods and success in finding new jobs. But the study identified differences between the job-search tools used by older and younger job seekers.
Older people tended to rely more on newspaper classified ads than younger people, who were more likely to use social networking tools to find new work. Both groups showed similar tendencies in using the Internet, word of mouth, contacts with friends and family, the use of online job boards, and attendance at job fairs.
The biggest difference, the center found, is that younger job seekers were much more likely to go back to school and pick up both job-hunting tips and also enhance their job skills. Nearly 40 percent of people younger than 55 did one of these two things, it reported, while only 25 percent of those older than 55 did so. Also, older people were less likely to tap their former employers to find a new job.
[See 5 Financial Skills Prized in a Tough Economy.]
"Many older workers said they felt personally hurt and even betrayed by their former employer, especially if they worked in their previous job for a long time," the Sloan study said. "This may account for why fewer older workers are using prior employers as a resource for job hunting than younger workers report doing. The propensity to rely on newspapers ads and company job boards, as opposed to social networking sites, may also contribute to a sense of isolation and leave older workers disconnected from the workforce."
The difficulty that older job seekers have had in finding new positions raises questions about employer attitudes toward employing or reemploying older persons. After making it so difficult on older job applicants, how will employers cope if tight labor markets reappear and they must seek older employees? Such a scenario is, in fact, widely forecast.
According to Sloan, workers 55 and older comprised 19 percent of the American workforce in 2009, up from 12 percent in 1999. Looking to 2019, they would total 25 percent of the workforce if past trends continue. The Urban Institute takes a slightly younger cut and says workers 50 years and older will account for 35 percent of the labor force by 2019.
As the economy improves and labor market tightens, lots of older employees will be receiving pensions and Social Security but will still have an income gap they would like to close with employment earnings. Such "partial" or "soft" retirement job needs will be common. Seniors in this situation will not want or value 40-hour work weeks and lots of job stress. They will, however, be seeking flexible working hours and locations, and could represent the emergence of a new kind of "piece rate" work force.
Right now, employers don't need and are unlikely to accommodate such demands. But as the labor market tightens, seniors will have more clout in gaining the types of jobs that work for their financial and lifestyle preferences.
To reach such a future, most labor market experts say the government and private employers will need to develop more effective and larger-scale training programs for older people. Social Security's early retirement benefits may also need to be reexamined.
Twitter: @PhilMoeller
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