June 27th, 2012
Econintersect: The net employment change from January 2010 to May 2012 has seen a net jobs growth of 4.3 million, according to outplacement specialist Challenger, Gray & Christmas. Almost 3 million of those employment gains have done to those over 55, or 69% of the total.
There were also job gains for the age groups between 20 and 34. Age 16 to 19 and the age groups between 35 and 54 experienced declines in the numbers employed. A curiosity in the employment data is that the 55 and older group leads in another category: long term unemployment. Once those older workers lose a job, 55% remain unemployed for more than 27 weeks.
Follow up:The older workers are not just getting positions as greeters at Walmart or taking orders at McDonalds. the latest employment statistics reveal that some of the biggest employment gains for those 55 and older have occurred among managers and professionals. The number of 55+ positions in those two categories is up by 693,000 from two years ago.
Econintersect has reviewed the demographic population estimates of the U.S. Census Bureau for 2010 and 2015. Those numbers indicate that the population aged 55-69 is expected to grow by 7.7 million over the five year period. For 2010 to 2012 an estimate of 40% of that number gives a population growth estimate in that demographic of 3.1 million. This means the job growth over 55 (just under 3.0 million) is very close to the population increase aged 55-69. Baby boomers are streaming into that demographic in large numbers.
Here is the full press release from Challenger, Gray & Christmas:
CHICAGO, June 25, 2012 – Recent reports reveal the challenge older job seekers face in the current hiring environment, with more than one-third of those 55 and older experiencing prolonged joblessness lasting longer than a year. However, the situation for older workers is not entirely grim. In fact, a new analysis of employment trends reveals that this segment of the population is enjoying the strongest job gains of any age group.
The analysis of government labor data by global outplacement consultancy Challenger, Gray & Christmas, Inc. found that job seekers age 55 and older account for nearly 70 percent of the employment gains since January 1, 2010.
Overall, the number of employed Americans has increased by 4,319,000 between January 2010 and May 2012, according to household survey data from the U.S. Bureau of Labor Statistics. Older job seekers – those 55 and up – accounted for 2,998,000 or 69 percent of the total employment growth.
Net Employment Change January 2010-May 2012
All Ages 16+
16 - 19
20 - 24
25 - 34
35 - 44
44 - 54
55 and older
The remainder of the employment gains occurred among 20- to 24-year-olds and 25- to 34-year-olds, who were able to increase the number with jobs by 980,000 and 882,000, respectively, since January 1, 2010. Meanwhile, teenagers, 35- to 44-year-olds, and 45- to 54-year-olds each saw employment decline over the last 28 months.
It is true that a growing portion of older job seekers are enduring long-term unemployment. According to data from the Government Accountability Office, 55 percent of workers 55 and older have been unemployed for 27 weeks, with 36 percent out of work for more than a year. In contrast, just 23 percent of older workers were jobless for 27 weeks or longer in 2007.
While a larger portion of older workers are experiencing prolonged unemployment, the overall unemployment rate for this group has seen improvement over the last two years, falling from 7.1 percent in May 2010 to a current level of 6.5 percent.
“The unemployment rate among older workers still has a ways to go before reaching pre-recession levels of about 3.0 percent, but the pace at which these job seekers are finding employment compared to younger ones suggests they could reach pre-recession jobless rates before anyone else,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
“Older workers may be benefitting from a desire among employers to keep hiring to a minimum. The economy is still only slowly recovering, so employers have repeatedly indicated that they are only adding workers when absolutely necessary. In this environment, a seasoned candidate who brings a wide variety of skills and experience to the table is going to have an advantage over younger candidates. For employers, one experienced candidate is worth two or three younger, greener candidates, in terms of the ability to make immediate and meaningful contributions to output and the bottom line,” said Challenger.
Belying the myth that older workers are finding only low-paying jobs in retail or other service-oriented industries, the latest employment statistics reveal that some of the biggest employment gains for those 55 and older have occurred among managers and professionals. As of May 2012, there were 6,274,000 Americans 55 and older employed in management, business and financial operations. That is up 12 percent from 5,581,000 in May 2010. The number working in professional and related occupations has increased 10 percent from 6,813,000 in May 2010 to 7,494,000 in May 2012.
Helping to drive the employment gains among experienced job seekers is the fact that a majority of companies recognize the value of having these workers on their payrolls. In a 2011 survey of company executives and benefit administrators by Bank of America about 94 percent said it is important to keep older workers due to their skills. In order to attract and retain these workers, the survey found that companies are offering customized schedules, education on retirement and health care, and the ability to work from home.
“However, even companies offering such benefits could find it increasingly difficult to convince older workers to stay on board. Would-be retirees have more options than ever before. They can go to competitors, they can switch industries and some are even changing careers. Others may start their own consulting firms or spend their time volunteering for non-profit groups. Companies that want their older workers to stay will have to ask and ask early.”
Even companies that ask nicely may be rebuffed by older workers looking forward to taking a new career direction in their non-retirement years. A 2008 Economic Policy Institute study found that 43 percent of workers switch jobs after age 50 and 27 percent change occupations.
More and more older workers are starting their own businesses. The number of self-employed workers age 55 and older has grown 13 percent from 2,873,000 in May 2010 to 3,258,000 as of May 2012. Most of the growth occurred among those 65 and older, whose ranks of self-employed increased from 820,000 two years ago to a record high of 1,030,000 as of May, according to data from the Bureau of Labor Statistics dating back to 1976.
Other older workers are embarking on second careers that they consider meaningful in terms of their impact on the community and society at large. According to a 2012 MetLife Foundation and Civic Ventures report, 9.0 million people between the ages of 44 and 70 are already in “encore careers,” which is defined as a new phase of work that offers not only continued income but the promise of greater meaning and the chance to do work that means something beyond themselves.
However, launching an encore career is not easy. The majority of those embarking on this path began to think about their second career at the age of 50, according the study, and took 18 months to make the transition. More than two-thirds of those in encore careers experienced gaps in personal income during the transition, with a quarter earning no money.
“Employers need to capitalize on this period in the economic recovery when it is significantly more difficult for older workers to embark on a new career path. In addition to increased telecommuting, for example, employers may need to explore a host of innovative scheduling options, including part-time schedules and the ability to work from different parts of the country at different times of the year. They may also want to examine options for contract work and redefining older workers’ roles and responsibilities,” said Challenger.