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Employment at Older Ages and the Changing Nature of Work

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Document date: November 01, 2007
Released online: March 28, 2008

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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Abstract

About 7 percent of American workers held highly physically demanding jobs in 2006, and 35 percent held highly cognitively demanding jobs. The share of the workforce in physically demanding jobs fell by about one-sixth between 1971 and 2006, while the share in cognitively demanding jobs increased by more than one-third. Stressful occupations also grew rapidly over the past 35 years. The decline in physically demanding occupations will likely improve employment prospects for older adults, but the growth in cognitive demands may limit options for some older people, especially those with limited education.


Introduction

The economic burden of an aging population depends on the employment decisions of older adults. If workers continue to retire at the relatively young ages that have become the norm over the past generation, then the aging of the baby boomers will reduce the number of people working and paying taxes for every older person collecting retirement and health benefits. Workers may have to pay higher taxes to support more retirees, employers may face labor shortages (particularly in selected industries), retirement benefits will likely be cut, and per capita economic output will fall. However, if people choose to work longer, the economy can produce more goods and services, boosting living standards for both workers and nonworkers and generating additional tax revenue to fund all kinds of government services. The crucial question, then, is whether older people will respond to the coming demographic challenges by working longer and retiring later.

Job attributes are important factors in the retirement decision. Positions that require heavy lifting, crouching, or stooping; standing for long periods; or other types of physically exhausting work are generally ill-suited for older workers, who often choose to retire early from these jobs if possible. Some older workers are forced to leave physically demanding jobs early when they develop health problems. Cognitively demanding work may be better suited for older people than physically demanding work, but probably not for those with limited education. Jobs that impose constant time pressures and require fast-paced work may be considered stressful and undesirable employment options by some older adults.

Changes over time in the nature of work have important implications for the employment prospects of older people. Older workers may be more likely to delay retirement if work is becoming less physically demanding. On the other hand, increases over time in work intensity may push some workers into early retirement. Better information is needed about the current distribution of job demands and how those demands are changing.

This report describes the job demands faced by workers today, the changes over time in job demands, and the impact of those changes on the employability of older workers. We linked job characteristics data from the U.S. Department of Labor’s Employment and Training Administration (ETA) to the Current Population Survey (CPS) to calculate the proportion of workers facing various types of job demands in 2006 and 1971. Employment projections were used to estimate the prevalence of job demands in 2014 and in 2041. The job attributes that we considered included physical demands, nonphysical demands, and difficult workplace conditions. We also examined how job demands varied by demographic characteristics, including gender, educational attainment, race, and age.

(End of excerpt. The entire paper is available in PDF format.)



Topics/Tags: | Employment | Retirement and Older Americans


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