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Abstract
Older adults' employment is attracting attention as many baby boomers approach traditional retirement ages. This fact sheet examines employers' current attitudes toward older workers and the likely future demand for their services.
Introduction
Current Demand for Older Workers
Employer attitudes toward older workers are mixed.
Employers value older workers’ loyalty, work ethic, reliability, and experience (figure 1 and Munnell, Sass, and Soto 2006)
- They view older white-collar workers as more productive than younger white-collar workers.
Yet, employers express concern that older workers may be less creative, less willing to take initiative, less willing to learn new things, and less able to perform physically demanding jobs (figure 2 and Munnell et al. 2006).
Employers are also concerned that older workers are more expensive.
- Older workers are paid more. In some cases, age–wage rate relationships reflect historical seniority arrangements instead of relationship of age and experience to productivity.
- Health insurance costs to employers increase with age (figure 3).
- Traditional defined benefit pension plans have very high accrual rates just before retirement age (figure 4).
Most employers report that older workers’ high productivity offsets their higher costs (Munnell et al. 2006).
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Disclaimer: 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.
