WASHINGTON — While older workers face job-market hurdles that their younger cohorts don't, those gray-haired workers may have an edge going forward as the national labor market slowly recovers. • The unemployment rate for older workers is at a near-record high, and once they're out of work, they tend to stay unemployed longer than younger workers. Plus, there's always the specter of ageism to consider. Still, at about 7 percent their unemployment rate is lower than the national rate of 9.7 percent, and once the labor market turns around, older workers are well-positioned to benefit, experts say.
With payrolls still weak from millions of cuts, companies need a knowledgeable work force that can be highly productive. Firms don't want to lose the institutional knowledge that some older workers have, said Jay Meschke, president of search firm EFL Associates, a CBIZ company.
"Companies may say that in these times, that person is more important to me," Meschke said. "Employers are valuing that segment of the work force more than (the) average person in the work force."
Others concur. "There are certainly a number of older workers who have pretty critical skills sets, and companies want to hold onto them," said Max Caldwell, a leader of Towers Watson's talent and rewards business.
Deborah Russell, the AARP's work force issues director, said employers in growing industries such as health care will aggressively recruit from the older demographic of workers as the population ages. "Hospitals are using strategies that look at retaining their current work force, as well as recruiting from the older work force," she said.
'Use these guys'
As the U.S. work force ages, companies will focus on how to make the most of it, said David Neumark, an economics professor at University of California-Irvine who researches age discrimination and the older work force.
"When the age structure of the population does shift, and there are so many older workers, employers may say, 'Geez, we have to figure out how to use these guys because they are the ones we can get,' " Neumark said.
Still, while some older workers may have an edge, data show that those without a job often have a tough time finding work.
In March, workers 55 and older were unemployed an average of 38.4 weeks, not seasonally adjusted, compared with 24.9 weeks for workers age 16 to 24, and 33.4 weeks for those age 25 to 54, according to the Bureau of Labor Statistics. Also in March, more than half of older job seekers — 50.6 percent — had been unemployed for 27 weeks or longer, compared with 33.3 percent of workers 16 to 24 and 44.7 percent of workers 25 to 54.
But the unemployment rate for older workers, those 55 and older, is lower than for workers age 16 and older. In March, the seasonally adjusted unemployment rate for older workers was 6.9 percent, compared with 7.1 percent in the prior month, and a record high of 7.2 percent in December. The general unemployment rate held steady at 9.7 percent in March.
Like other age groups, older workers will face a labor supply and demand mismatch for several years, experts said. However, there is reason for hope, Meschke said.
"We are starting to see light at the end of the tunnel. Late in the fourth quarter we started to see larger employers hiring again. The Fortune 500 employers are starting to say, 'We may have cut too much into muscle,' " Meschke said. "Companies are like individuals — they are tired of succumbing to growth malaise."
The will to keep working
Older adults have good reason to keep working. For one, better overall health enables workers to work for longer, and many enjoy doing so.
"You have people who are financially ready, but aren't leaving the work force," Caldwell said. "They are having fun at work and want to keep going."
Workers also have financial motivations, as with the rise of defined-contribution plans, they have more responsibility for their retirement. And those who have experienced financial losses in the economic downturn will want to buffer their savings.
"They don't have the savings they thought they would, and they are going to want to work," said Nigel Gault, chief U.S. economist with economic analysis firm IHS Global Insight.
All this extended working among the older population has caused some concern about a "gray ceiling," where older workers stay longer in their jobs and prevent younger workers from progressing in organizations.
"If those workers are staying in their job that creates a blockage," Gault said.
Workers younger than 55 may be frustrated by the "gray ceiling," Meschke said. "If workers 55 and older are not retiring, then the under-55-year-olds are not stepping up into leadership posts," Meschke said. "This really could hurt future leadership."
This bottleneck could worsen going forward because workers know they are responsible for their retirement, but don't feel prepared, Caldwell said.
"You have a group of people aging into their 50s and 60s that are less prepared for retirement because they don't have defined-benefit plans. So even with the improving economy that could exacerbate the bottleneck issue," Caldwell said.
The concept of a gray ceiling, however, runs counter to the AARP's research, Russell said. Many older workers are happy to mentor younger workers into higher positions, she said.
"There is less of an interest in remaining in management and decision-making positions," Russell said. Older workers "are really at a point in their lives where they are looking to give back, get a job that provides meaning. Their priorities shift."
Lorraine Harris, a 56-year old Florida resident, retired last year from a full-time job, and said she's enjoying her new life as a volunteer and part-time worker, greeting guests for Princess Cruises.
"I wanted to stay really active. I didn't want to stay home, watching TV . . . It's not healthy," Harris said.
She hasn't found her age to be a hindrance when it comes to finding work. But some job seekers complain about ageism in the hiring process.
Such discrimination can be hard to prove, Neumark said.
"How can you tell? It's common not to get a job you apply for," Neumark said. "Even the most privileged young white guy won't get every job he applies for."