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Money Culture

Older Workers Ride Out Computer Age

The computer revolution, unleashed in the 1970s, has not stopped. Minicomputers replaced mainframes, and IBM introduced its personal computer. Then came the Internet, laptops, robots, iPhones, and increasingly intelligent software that can drive cars and discern music preferences.

Continual technological change has reshaped and regenerated the economy several times over, creating new types of jobs unimaginable a few years earlier. But the past four decades have also been tumultuous for the workers who were either replaced by machines or couldn’t keep up with the evolving demands of their jobs.

This is a pressing issue for the older workers who would benefit from working longer to improve their retirement finances. An erosion in their physical stamina or mental agility conceivably makes them more vulnerable to losing out to progress. And it can be difficult for people who have invested years in a job to train for and find new employment.

But a new study of labor force trends by the Center for Retirement Research finds this has not been the case. The computer age has had about the same impact on workers over age 55 as it has had on the labor force overall.

Two factors have proved essential to whether people – whatever their age – have had job security in this period of change: whether the work is routine and whether it requires a college education.

Since the 1970s, job options have narrowed for many workers who did not attend college, because computers have been especially good at rapidly and tirelessly performing the routine tasks this group’s work often entails. Examples are the computerized financial transactions that replaced back-office workers who entered the data manually and the robots inserted into assembly lines. The more routine a worker’s job, the more vulnerable he is to being replaced by a machine.

The upshot is that this segment of the labor force is shrinking: roughly a third of U.S. workers hold routine jobs currently, down from more than half in 1979. Nevertheless, the magnitude of this decline has been roughly the same for workers over 50 as for the labor force overall, according to the study, which was conducted for the Retirement and Disability Research Consortium.

In contrast, computerization has not affected the demand for non-routine work that is physical in nature, such as construction and food preparation. These jobs typically do not require a college education either, but it has been virtually impossible to program computers to do non-repetitive work. “The rules governing our innate abilities are a mystery,” and this has protected jobs that emphasize uniquely human abilities, the researchers said.

The big increase in employment over the past 40 years has occurred in non-routine, creative work requiring a college education – think computer programmers, managers, and consultants. These jobs account for nearly half of total employment, up from a third in the late 1970s, and older people have managed to keep up with the new technologies necessary to do these jobs effectively.

The question for the future is that, as artificial intelligence continues to evolve and more closely replicate our innate abilities, will this finally portend the widespread destruction of jobs that critics of technology have long predicted? The next blog in this series will look to the future to answer this question.

To read the brief, authored by Anek Belbase and Anqi Chen, see “How Did Computerization Since the 1980s Affect Older Workers?”  

The research reported herein was derived in whole or in part from research activities performed pursuant to a grant from the U.S. Social Security Administration (SSA) funded as part of the Retirement and Disability Research Consortium.  The opinions and conclusions expressed are solely those of the authors and do not represent the opinions or policy of SSA, any agency of the federal government, or Boston College.  Neither the United States Government nor any agency thereof, nor any of their employees, make any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of the contents of this report.  Reference herein to any specific commercial product, process or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply endorsement, recommendation or favoring by the United States Government or any agency thereof.

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