Good news: A new study finds that older Americans have more job options these days when it comes to working longer.
Over the years, researchers at the Center for Retirement Research have found that job hunters in the 50-64 age group are more likely to be hired for what they call “old-person jobs”—lower-paying, lower-skilled positions. However, their latest study1 shows fewer older workers are being forced into these types of jobs today, suggesting a better job outlook for boomers who wish to work up to (and even beyond) retirement age.
For example, between 1996 and 2000, nearly one quarter of job seekers in the 60-64 age range (24.5 percent) were hired into old-person jobs. Between 2008 and 2012, however, that percentage dipped to just 21 percent. For those in the 50-54 age range, just 1.4 percent were forced into an old-person job between 2008 and 2012, compared to 4 percent between 1996 and 2000. While the change isn’t dramatic, researchers say it suggests that older job-seekers are finding more options today, thanks to factors like an increase in knowledge-based, less physical jobs and a greater number of older hiring managers.
For baby boomers, the shift could boost prospects for a healthier, more stable retirement. The study found that old-person jobs tend to pay less compared to other jobs—7.4 percent less for those aged 55-59, and 5.9 percent less for those aged 60-64—which can cut into funds available for retirement. That’s important, considering the average boomer has just $136,200 saved for their non-working years, according to a Black Rock survey2. That translates to an annual retirement income of just $9,150. Working longer means boomers can save more and also delay the number of years they’ll have to depend on their nest egg.
Additionally, working longer has been shown to boost health in near-retirees. One study3 even found that delaying retirement by just one year—from age 65 to 66—lowered a worker’s chance of death by 11 percent.
It won’t necessarily be easy for job-seeking boomers, of course. Fully 60 percent of current retirees stopped working earlier than planned, according to a recent study4. While some retired because of ill health, 27 percent stopped because of “organizational changes at my place of employment” and 26 percent because they’d lost their jobs. Among those surveyed, the average retiree quit working at just age 62.
Fortunately, education can help. The researchers found that people with at least some college are less likely to be forced into old-person jobs. For example, among college-educated men, 8.9 percent took an old-person job between 2008 and 2012, compared to 16.3 percent of those without any college education. Baby boomers who keep their skills fresh and their eyes open, then, have a good shot at enjoying more job options, even as they grow older.
1 Johnson, Richard, and David Neumark. "Age Discrimination, Job Separation, and Employment Status of Older Workers: Evidence from Self-Reports." (1996): n. pag. Aug. 2016. Web.
2 ENGAGED INVESTORS READY FOR LONGER LIVES (n.d.): n. pag. Blackrock. Web.
3 Wu, Chenkai, Michelle C. Odden, and Gwenith G. Fisher. "Association of Retirement Age with Mortality: A Population-based Longitudinal Study among Older Adults in the USA." Wu Et Al. -- Journal of Epidemiology & Community Health. N.p., Mar. 2016. Web.
4 Collinson, Catherine. The Current State of Retirement: The Pre-Retiree Expectations and Retiree Realities (n.d.): n. pag. Transamerica Institute, Dec. 2015. Web.