Are Employers Willing to Hire and Retain Older Workers?

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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.

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).

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

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