AARP Eye Center
In 2015, several years after the official end of the Great Recession, the AARP Public Policy Institute's report The Long Road Back looked at the continuing challenges many older workers were still trying to overcome. It highlighted findings from a survey of people who were unemployed during the previous five years, including people ages 45 to 70 that were unemployed short term, multiple times, or long term (27 weeks or longer).
The challenges they faced, including the risk of long-term unemployment, the problem of age discrimination, and the difficulty of recovering from the financial shock of unemployment, provide insight into what may lie ahead for many of today's 50+ jobseekers dealing with the pandemic-related downturn.
A distinguishing feature in the experience of older jobseekers during and after the Great Recession was extended periods of long-term unemployment. During that time, average durations of unemployment for older jobseekers were sometimes as much as double that of younger jobseekers.
When the economy is strong, and employers have trouble filling positions, the differences in length of unemployment between older and younger jobseekers can subside. But they reemerge during downturns when older jobseekers are more likely to experience markedly longer spells of unemployment. During the Great Recession, there was evidence that some employers were reluctant to hire the long-term unemployed. Not surprisingly, the longer individuals remain out of work, the more likely they are to drop out of the labor market entirely. The depth of the current downturn looks likely to lead to a sharp rise in long-term unemployment, especially among the 50+, and may force some to leave the labor market sooner than planned.
Age discrimination was another factor older jobseekers faced during and in the aftermath of the Great Recession. The 2015 AARP study found that while the biggest barrier to employment that respondents reported was simply a lack of available jobs, age discrimination was another important barrier. Fifty-seven percent of respondents indicated that "employers think I am too old."
Age discrimination continues to be a problem. Over 60 percent of American adults over the age of 45 report that they have either seen or experienced age discrimination in the workplace. Moreover, a new NBER Working Paper provides evidence that discrimination against both current and prospective older employees increases during recessions. As the COVID-19 recession wears on, older jobseekers may increasingly deal with age discrimination as a barrier to finding work.
Trouble Recovering Financially
Even many of the 2015 survey respondents who were eventually able to find work still had trouble recovering financially. Many had to accept jobs with lower pay or in a different occupation than their previous employment, or with fewer hours or limited benefits, or both. These financial setbacks in the years leading up to retirement influenced how much these older workers were able to save and undermined their future financial security.
Today, most older Americans who work do so out of economic necessity, and the current high level of job loss among workers of all ages is causing considerable financial strain. Recovering from an unexpected financial shock such as that experienced by the many workers who lost their jobs in recent months can take years.
Getting People Back to Work
These challenges come at a time when people are increasingly encouraged to, or in many cases, must continue working later in life. There is a growing body of evidence of both the benefits of extending working lives (e.g., health and social engagement) and the risks of long-term unemployment (e.g., loss of savings and retirement security). This awareness can serve as additional motivation for employers and policy makers to consider new ways to get people back to work, and support workers of all ages, including the 50+.
For more jobs data: Find the latest employment data in the AARP Public Policy Institute's (PPI) Employment Data Digest, PPI's monthly review of job trends for those ages 55 and over. Visit the AARP website's work and jobs section for articles on work and unemployment and job search resources.