Health, Age, and Labor Force Disruption of Older Workers

1
Health, Age, and Labor Force Disruption of Older
Workers
Victor W. Marshall, Ph.D.Director, UNC Institute
on Aging
Aging is Good Business The Silvering Workforce
UNC GreensboroApril 8, 2009
2
Overview of Presentation

• Aging of Population and Graying of the Workforce
• Why older workers want to stay employed
• Why we need to facilitate employment of older
  workers
• Stereotypes about Older Workers and Health
• Health and Labor Force Participation
• What we need to do

3
Trends in Workforce Aging

• Global Aging of Populations
• US population is relatively younger
• high numbers of younger immigrants
• higher fertility rates than U.S. born population
• decrease the median age
• Median age of the US labor force increasing
• 1986- 35.4
• 2006 -40.8
• 2016- 42.1 ( projected)

4
U.S. Population Pyramids
2000
2020
Source of charts U.S. Census Bureau, 65 in the
United States 2005, December 2005.
5
Projected Population Changes 2005-2025

• The population age 25-54 will grow from about 126
  million to almost 131 million.
• The population age 55 and over will grow at a
  much faster rate, from about 67 million to nearly
  105 million.

Source Patrick Purcell, Older Workers
Employment and Retirement Trends, CRS Report for
Congress, September 14, 2005.
6
Employment Trends Ages 25-54 Labor Force
Participation Rates, 1950-2005
Sources of data Patrick Purcell, Older Workers
Employment and Retirement Trends, CRS Report for
Congress, September 14, 2005 U.S. Census Bureau,
Statistical Abstract of the United States, 2007.
7
Employment Trends Ages 55-64 Labor Force
Participation Rates, 1950-2005
Sources of data Patrick Purcell, Older Workers
Employment and Retirement Trends, CRS Report for
Congress, September 14, 2005 U.S. Census Bureau,
Statistical Abstract of the United States, 2007.
8
Employment Trends Ages 65 Labor Force
Participation Rates, 1950-2005
Sources of data Patrick Purcell, Older Workers
Employment and Retirement Trends, CRS Report for
Congress, September 14, 2005 U.S. Census Bureau,
Statistical Abstract of the United States, 2007.
9
Percent Increase in Employment by Age and Gender,
1977-2007
Greater increase in older workers, older female
workers.
10
Projected Graying of the Workforce

11
Older Workers Expect to Stay in the Workforce

• 70 to 75 of Americans expect to work to some
  extent after retirement (Merrill Lynch,
  2005Rutgers, 2008).
• With deteriorating economic conditions 45 of
  Americans believe they will retire at a later age
  than they originally expected (Gallup, 2008)

12
Older Workers Profile

• Older workers tend to be healthier, more
  prosperous, and better educated than their
  retired counterparts.
• Many factors influence decisions to remain in the
  labor force.
• Individual or family financial situations, based
  on general economic conditions, access to Social
  Security and pension benefits, and the
  availability of health insurance.
• Personal situations, e.g., health and their
  enjoyment of work.

Sources Patrick Purcell, Older Workers
Employment and Retirement Trends, CRS Report for
Congress, September 14, 2005 U.S. Census Bureau,
65 in the United States 2005, December 2005.
13
Older Workers and non-traditional work
arrangements

• As they transition to retirement, older workers
  are more likely to work part-time, be
  self-employed, or engage in other nontraditional
  employment arrangements.

Sources Patrick Purcell, Older Workers
Employment and Retirement Trends, CRS Report for
Congress, September 14, 2005 U.S. Census Bureau,
65 in the United States 2005, December 2005.
14
Why Work Beyond Normal Retirement?

• AARP study of work after retirement
• Need the income 76
• Enjoy working/stay connected to others 70
• Need for health benefits 61
• Desire to stay mentally active, keep learning,
  and be useful 52
• (AARP 2008)

15
Limited Savings for Older Workers

• Savings Investments, workers aged 55
• Less than 10,000 28
• 25,000 8
• 50,000 7
• 100,000 16
• 250,000 18
• 250,000 23
• Source Employee Benefit Research Institute,
  Bureau of Labor Statistics, 2008. (excludes
  value of home pension plans)

16
Changes in Retirement Benefits
17
Changes in Retirement Benefits

• Over the last 2 decades companies have shifted
  from traditional pensions to 401(k)s,
  transferring retirement costs from companies to
  employees. (Greenhouse, 2008)
• For too many Americans, 401(k) plans have become
  little more than a high stakes crapshoot.
  (George Miller, Chair, House Education and Labor
  Committee, Feb. 2009)
• Workers have lost 2 trillion in 401(k)s in the
  last 15 months. (Congressional Budget Office,
  2009)
• Just social security and 401(k) plans will not
  give retirees enough money. (Alicia Munnell,
  Center for Retirement Research, Boston College,
  2009)

18
Reemployment Experiences of Older Workers
Age group Reemployment rate 20-24 66 25-54 75
55-64 61 65 25 Source GAO, 2007

•  Older workers are more likely than younger
  workers to be displaced
•  Less likely to get another job
•  It takes them longer to get another job
•  Workers under 50 are 42 more likely to get an
  interview than those 50 (Lahey, 2005)

19
Reemployment Consequences for older workers

• Greater earning losses than younger workers
• Dislocated workers with 20 years of experience
  find jobs paying between 20-40 less than their
  previous job
• Fewer employment opportunities in a narrower
  range of industries and occupations than younger
  workers(Heidkamp and Van Horn, 2008)          
• Older men, especially those laid off in male
  dominated manufacturing industries, are
  disproportionately represented in the long-term
  unemployed (lasting more that 6 months)

20
Older Adult Unemployment, 2007-2009
Source www.urban.org/retirement_policy/url.cfm?ID
411846 (Bureau of Labor Statistics 2009b data)
21
Older Workers Part-time and Full-time Employment

• Between 1990 and 1995 increase in part-time work
  and decline in full time work
• Between 1995 and 2007 older workers on full-time
  schedules doubled, while part-time workers
  increased only 19
• By 2007 56 of older workers full time trend
  likely to continue (Bureau of Labor Statistics,
  2008)

22
Older Workers Part-Time and Full-Time Employment
Part-time
Full-time
23
Why we need to facilitate employment among older
workers

• Many of them want to work or need to work
• We need people to work longer because the large
  baby boom cohort is passing into retirement
• The need is greater in some sectors than others
• Labor force disruption has negative health
  consequences
• I WILL NOW FOCUS ON THE WORK AND HEALTH
  RELATIONSHIP

24
Barriers Ageism and Age Discrimination

• National studies of employers show barriers to
  hiring and retaining older workers
• Employers wrongly assume older workers are more
  expensive due to
• Compensation
• Costs of health insurance
• Costs of training
• Lower production and lower quality work than
  younger workers
• Resistance to change
• Employers also fear age discrimination lawsuits
  in laying off recently hired older workers (GAO,
  2007)

25
Countering Age Discrimination

• Ageism (attitudinal) is not the same as Age
  Discrimination (behavioral)
• Perceived age discrimination alone can lead to
  mental health problems (Yuan 2007)
• Older job seekers 40 less likely to get
  interview (Lahey 2005)
• Ageism related to concerns about health and
  ability to adapt to technological and
  organizational change

26
How true are the stereotypes?

• Realistically, there are aging-associated health
  issues
• But these are too frequently exaggerated

27

Percent of Population that is Obese (BMI equal to
or greater than 30) by Age, Selected Years.
Percent ()
Data source The National Health and Nutrition
Examination Survey
28
Note The need for assistance with activities of
daily living was not asked of children under 6
years. Source Brault, Matthew W. Americans
with Disabilities 2005 (2008) Current
Population Reports in U.S. Census Bureau, survey
of Income and Program Participation,
June-September 2005.
29
Life Expectancy at Age 65 by Sex and
Race/Ethnicity, 1950-2003
Years
Data Source The National Vital Statistic System
30
Average Length of Hospital Stay (in days) by
Age, 1970-2004
Average length of stay in days
Data Source The National Hospital Discharge
Survey
31
Current Cigarette Smoking by Age and Sex,
1965-2005
Percent ()
1965
1975
1995
1985
2005
Data source National Health Interview Survey
32
Older Adults Report Being Healthier

• Older adults reporting excellent or good health
• Source National Center for Health Statistics,
  2008.

Age 2008
55-64 65 80 66
Prepared by the UNC Institute on Aging
33
Schematicperformance ability and agemost people
will retire or reach very advanced age before
declines in ability fall below levels needed for
their job
34
Are Older Workers Less Productive?

• There is no evidence that older workers
  performance and the importance of their
  accumulated knowledge do not compensate for their
  higher cost (ILO, 2005).
• Older workers can be as productive as younger
  workers, especially if we increase job
  flexibility and design jobs suitable for them
  (Victor Marshall, UNC-Institute on Aging, 2008).

Prepared by the UNC Institute on Aging
35
Chesley Sullenberg An Older Worker (Age 58)

• Pilot license at age 14 Best aviator in class,
  Air Force Academy Commercial pilot since 1980
• Co-pilot, Jeffrey Skiles, Age 49, flying since
  age of 15 20 years experience as commercial
  pilot
• Prior to 1959 no mandatory retirement age in US
  for pilots
• 1959 imposed age 60 but in 2007 FAA approved age
  65 (LICAO requires one pilot to be under age 60
  for international)
• Research on Air Traffic Controllers Experience
  can compensate for declines in cognitive function
  that might otherwise appear with aging (Nunes
  Kramer (2009), Journal of Experimental
  Psychology Applied 15 (1) 12-24

36
Health and Labor Force Disruption

• The relationship between retirement and health
• Health problems cause labor force disruption
• Labor force disruption causes health problems
• Recent reports show U.S. workers aged 50
  experience a disproportionate share of
  involuntary job loss

37
Consequences of Loss of Work

• Loss of earnings a social determinant of health
• Poorer job quality in replacement jobs
• Forfeiture of health and pension benefits
• Reduced social involvement
• Harmful health behaviors
• Anxiety and other mental health problems
• Increased physical disability at two years
  post-loss (stronger effects in women than men)
• Source Gallo, et al., and several studies they
  cite in Research on Aging 31 (3), May 2009

38
Consequences of Instability in Labor Force
Participation The Bell Canada Retiree Study

• MALE AND FEMALE , early retirees from Bell
  Canada who experienced more post-retirement
  unemployment periods (greater labor force
  instability) and experienced higher perceived
  stress
• The effects were stronger for women than for men
• MEN who anticipated working post-retirement from
  Bell but did not (violated expectations) were
  more likely to report life stress and low life
  satisfaction
• Source V. Marshall, P. J. Clarke, P.
  Ballantyne. (2001. Instability in the retirement
  transition, Research on Aging 23 (4) 379-409

39
What we need to do To promote working longer

• Reverse the idealization of early retirement
• (we will need the labor of older workers for
  economic growth)
• Create Flexible Working Arrangements

40
What we need to do To promote health

• Create age-friendly workplaces
• Age-mixed teams
• Mentoring
• Better ergonomics
• Retrain and Reassign for age-appropriate jobs
• Increase workplace health promotion programs
• Training for transitions into retirement

41
Aging Workforce Initiatives, UNC Institute on
Aging

• Applied research, e.g., case studies at the
  company level
• Aging Workforce Interest Group
• Seminars
• Digital Library
• Pub Alerts on the aging workforce, Frontline
  Healthcare Workers, Health Promotion and Healthy
  Aging, and Lifelong Learning and Engagement
• Available at www.aging.unc.edu or by contacting
  Dr. Peter J. Stein, Associate Director, Aging
  Workforce Initiatives pjstein_at_schsr.unc.edu