April 21, 2015
Employer Bias Against Aging Boomers?
The job market is improving, but more than half of baby boomers surveyed felt age discrimination “prevented them from working as much as they would like.” Squared Away interviewed Joanna Lahey, associate professor at Texas A&M University’s Bush School of Government and Public Service, who says age discrimination is extremely difficult to “prove.”
Many older workers have legitimate complaints about being discriminated against. But what does the research tell us about how pervasive it is?
Lahey: Before I answer that, let me clarify something. Older people who are working do well compared to younger workers. On average, they have more money and stability. It’s the older job seekers whose experiences worry policy makers and researchers.
The bottom line is we really don’t know how pervasive age discrimination is, and there’s a lot of room for more research on this. In one experiment I did, younger workers were 40 percent more likely to be called back for an interview than older workers – but that was only women, and they were applying only for entry-level positions.
Age and experience are correlated with each other, so it’s really hard for researchers to tell if someone’s being discriminated against because of their age or because of some sort of mismatch between older workers’ more extensive experience and the job requirements.
The U.S. unemployment rate was a low 5.5 percent in March. Doesn’t age discrimination fade when employers are hiring?
Lahey: There are three different answers. First, someone needs to do age discrimination experiments in places with high and low unemployment rates and make comparisons – there’s one being run now.
A second answer is that in one study I did, it was much better for an older worker to get, say, an LPN degree and apply to be a nurse – a profession with low unemployment – than to apply for a job with a higher unemployment rate such as a clerical worker. At the same time, the amount of age discrimination I measured was much greater for nursing than for clerical work or retail sales. But although younger workers were far more preferred for the nursing jobs, nursing was also still the best bet for an older worker.
A third answer is a new research paper looking at the effectiveness of age discrimination laws, which finds that it’s easier to discriminate against older workers during recessions. An explanation might be that it’s harder to prove discrimination when employers are laying off lots of people.
What other difficulties are there in gauging age discrimination?
Lahey: It could be that more experienced people expect to have higher wages, and they’re not accepting jobs because they want a higher wage than a younger person would accept. So when we see that it takes longer for an older person to get a job, we don’t know if the employer is discriminating against them or if this older worker expects to be rewarded for this experience, even though the job may not be paying [enough to reflect the experience]. That’s not discrimination, and, from a research perspective, it’s very hard to disentangle these things.
Also, researchers can’t just compare older and younger workers with the same experience, because you expect older people to have more experience. If the older person doesn’t have more experience, that might be a signal to the employer that there’s something wrong with them. If they do have experience, it’s very hard to understand, what does this experience mean?
As baby boomers age, has there been an increase, as expected, in age discrimination cases?
Lahey: Yes, it’s going up over time, and you can see the effect of the baby boomers aging underlying the trend. For example, in 1997 the U.S. Equal Employment Opportunity Commission (EEOC) received 15,785 charges under the Age Discrimination in Employment Act (ADEA), and in 2014 that number had increased to 20,588. But there is also a pattern of more complaints during recessions – in 2008, the EEOC received 24,582 ADEA complaints. The number has gone down since the 2008-2009 recession, probably because, instead of suing, older people are more likely to just get another job.
Is age discrimination more difficult to prove than discrimination based on race or sex?
Lahey: Yes. Age discrimination legislation is different than Civil Rights Act legislation. The U.S. Supreme Court over the years has made things more or less difficult [for older employees], and right now it’s in a more difficult phase. In practice, to prove age discrimination, you need a smoking gun, like having a supervisor or manager who’s written a memo or said something ageist in front of people – and it has to be pretty explicit, say using the word “geezers.”
Is it clear that it takes longer for older people to get hired than younger people with similar qualifications?
Lahey: We definitely know that it takes longer. According to an AARP study of Bureau of Labor Statistics data in December 2014, it takes five months longer. That’s not a new problem – the number may change but the gap has been there. It was prominently written about in 1984 and probably existed well before then. Of course, we don’t know how much of this is discrimination and how much is older workers being picky because they can retire, or hang out with their grandkids, or they might have more savings.
My work has shown that age discrimination certainly exists, but much more work needs to be done before we can understand the true extent of this discrimination.
Describe your experiment showing that older women are treated differently in the job market.
Lahey: During the 2003 recession, I sent out thousands of resumes for women of different ages to all the entry-level jobs I could find in Boston newspapers and online in St. Petersburg, Florida. I sampled 40 jobs every week in each city and sent out two resumes for each job – one from Mary and one from Linda. When I measured the response rate by the date of their high school graduation, younger workers were 40 percent more likely to be called back for an interview than an older worker.
Why did you study only women?
Lahey: I picked women because, when men apply for an entry-level job, employers may really worry about an older man with gaps in his experience, especially with older age groups who probably were not being stay-at-home husbands. If women have gaps in their experience, employers assume they were taking care of kids.
I’d like to see a comparison with Canada and Europe, with their public, not job-linked health care finance systems.
Older people are more likely to have health problems, and in employer-financed policies, health insurers take the age of those to be covered into account when deciding how much to charge.
For a small firm, adding an older worker, say one age 60, might have serious ramifications for the cost of insurance. And that is a big disincentive to hire them.
That’s a disincentive that doesn’t exist in the other countries. And it doesn’t exist for those 65 and over in the U.S. Hasn’t employment been rising for those 65 and over and falling for those 55 to 64, long-term?
Is wage stickiness a problem? Probably. The older workers might have to accept less pay than in the past, to offset the rising cost of health care. If health care was not employment linked, they would experience this as an increase in health insurance costs, not a decrease in employability.
This is just one negative economic consequence of employer-linked health insurance.
You are quite right Larry.
I am trying to get an insurer for an aunt who is almost 90 years old, and all I am getting is that she can no longer apply for that kind of service.
The population is aging, but the services are not prepared to handle such reality. Today’s industries are focused on improving the probability of long lives and they are improving every day; how can they expect to have people live to nearly 100 years with no opportunities for work or access to health services?
I strongly encourage you to do more research on age discrimination. It’s desperately needed.
Based on personal experience and that of many of my professional baby boomer friends, age discrimination is rampant in nearly every job category. For those over 40, it’s challenging, while for those over 50, it’s much worse. This is especially the case in younger metro areas such as the Silicon Valley, Austin, LA and Seattle. Many young people are moving – without jobs – to these top-rated cities for tech professions.