Industry News

Demand for Older Workers Shatters Myths

Oldest Americans Gain Jobs Even as Other Age Groups Suffer Losses

CHICAGO – The slowing economy has dampened the demand for older workers, but not much. The number of workers 55 and older is still growing significantly while those younger than 45 struggle with widespread job loss.

An analysis of Bureau of Labor Statistics data by global outplacement consultancy Challenger, Gray & Christmas, Inc. found that employment among those 55 and older grew by 3.7 percent from 25,686,000 in July 2007 to 26,631,000 in July 2008. The number of employed 20- to 44-year-olds declined by an average of 1.3 percent during the same period.

The new report, released Thursday, shatters the myth that older workers are particularly vulnerable in this economic downturn.

"The fact is pared down companies may increasingly rely on seasoned veterans to get them through the downturn. They may cost more in salary and benefits, but their experience and knowledge make them highly valued," said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

The Challenger analysis also belies the myth that older workers are for the most part underemployed, seemingly able to find only part-time, hourly wage positions in retail and other low-skill service industries. The Bureau of Labor Statistics data show that the biggest employment gains for workers 55 and older occurred within management, professional and related occupations. The number of workers 55 and up in these positions increased by 659,000 or 6.5 percent over the last 12 months.

Some of the employment growth for workers 55 and older is due to the fact that this population is rapidly expanding as baby boomers age. However, population growth is not solely responsible for the employment gains. The number of Americans 55 and older grew by 2.7 percent over the last 12 months, while employment for these workers grew by 3.7 percent.

The preference for older workers has also resulted in a significant drop in the amount of time it takes job seekers 50 and older to find new positions.

The median job search for those over 50 winning positions in the second quarter lasted 4.2 months, according to the latest Challenger quarterly survey of discharged managers and executives. That is just about two weeks longer than younger job seekers, whose median job search time in the second quarter was 3.6 months.

The demand for older workers is particularly high in sectors that continue to experience growth despite the current economic malaise. One such industry is information technology, which will see the number computer systems analyst positions and network systems and data communications analysts increase 37 percent to 1,052,000 jobs by 2016.

This growth is already occurring in some areas. In Nebraska, for example, the Omaha World Herald cited census data showing that the portion of people age 50 through 65-plus employed as IT workers has grown from 12.4 percent in 2000 to nearly 24 percent in 2006.

"This downturn will not last forever. Companies that are looking beyond the next few quarters of sluggish economic growth are anticipating significant labor shortages due to the large number of potential retirements. We say, ‘potential' because some companies are taking steps now to delay these retirements and aging workers who are growing increasingly concerned about their nest eggs are more than happy to oblige," said Challenger.

A recent survey of 140 mid-size and large companies by Hewitt Associates found that 55 percent have evaluated the impact that potential retirements could have on their organizations. Sixty-one percent of the companies surveyed developed or plan to develop special programs to retain near-retirement workers, including phased retirements that allow would-be retirees to reduce their hours (and salaries) incrementally instead of all at once.

"This is a win-win for employers and potential retirees. The employer gets the benefit of retaining experienced personnel who will have more time to pass along their corporate knowledge to younger workers. Aging workers benefit by not being thrust into retirement before they are mentally and financially ready," said Challenger.

The percentage of older workers who say they are very confident about having enough money to retire has fallen sharply from 27 percent in 2007 to 18 percent in 2008, according to the Employee Benefit Research Institute. In a recent AARP survey of 55- to 64-year-olds, 20 percent plan to delay retirement because of current economic conditions.

"Inflation is having a significant impact on older workers' ability to retire. The other major factor is falling home values, one which many Americans counted for continued growth in order to help fund their retirement. For many people, the plan of selling their home for a nice profit and moving into a one-bedroom condo was squashed with the collapse of the housing market. This may not be the case for those who stayed in one home for 25 or 30 years, but many families that kept upgrading their homes during the housing boom may now be stuck," said Challenger.

"However, this does not mean that companies will have an easy time convincing the older workers to stay on board. Would-be retirees have more options than ever before. They can go to competitors, they can switch industries and some are even changing careers. Others may start their own consulting firms or spend their time volunteering for non-profit groups. Companies that want their older workers to stay have to ask and ask early."

Even companies that ask nicely may be rebuffed by older workers looking forward to taking a new career direction in their non-retirement years. The Economic Policy Institute reports that 43 percent of workers switch jobs after age 50 and 27 percent change occupations.

More and more older workers are starting their own businesses. The number of self-employed workers age 55 and older has grown 10 percent since 2005, from 2,602,000 to 2,853,000 as of July 2008.

Other older workers are embarking on second careers that they consider meaningful in terms of their impact on the community and society at large. Extrapolating on the findings of a new survey conducted among 3,500 baby boomers, the MetLife Foundation and Civic Ventures estimate that 5.3 million to 8.4 million 44- to 70-year-olds have already launched encore careers, which Civic Ventures defines as a new phase of work that offers not only continued income but the promise of greater meaning and the chance to do work that means something beyond themselves.

Of those between age 44 and 70 not already in encore careers, half say they are interested in moving into jobs in such fields as education, health care, government, and the nonprofit sector.

"Older workers indeed have a lot more options between increased demand among traditional corporate employers, entrepreneurship and encore careers. Of course, this does not make the job search any easier for these individuals when they decide they are ready to move to the next phase of their career or return to the workplace after an attempt at traditional retirement," said Challenger.

"The biggest obstacles most older job seekers face are self-imposed. Self-doubt and defensiveness about your age will handicap you in the interview," he advised.

HOW OLDER WORKERS WIN JOBS FAST

Nearly one million workers age 55 and older have won new jobs over the last 12 months, making it one of the only age groups that is actually experiencing employment gains.

John A. Challenger, chief executive officer of global outplacement consultancy Challenger, Gray & Christmas, Inc., describes the key guidelines workers and job seekers 55 and older need to follow:

Dismantle The Myths
Older job seekers should face the fact that they will probably be interviewing with someone who may be 10, 20 or even 30 years their junior. These individuals will have their own preconceptions or prejudices about older individuals that could taint their view of the candidate before the interview ever starts, which may include:

  • Older people are sick more and take more leave.
  • They are set in their ways and therefore cannot be trained.
  • Younger workers and older workers will clash.
  • They are only looking ahead to the day they can permanently retire.

Employers are not permitted to ask questions that pertain to age, but the questions may still exist in the mind of the interviewer.

Be Accommodating
Throughout the interview process, do your best to accommodate the schedule of the interviewer. This may mean meeting early in the morning, in the evening or even on the weekend. The job seeker who says he/she cannot come in for an interview after hours will screen himself or herself out of the interview process immediately, regardless of age. It sends the message that once on the job he/she will not be willing to put in extra hours to get the work done.

Emphasize Past Examples Of Loyalty
Although employee/employer loyalty has been severely tested over the years due to ongoing layoffs, employers still need to feel that employees are 100 percent committed to the company.

Emphasize Relevant Experience
The prospective employer should feel that you can hit the ground running. It is important to convince the interviewer that age has nothing to do with learning new concepts and accepting new ways of doing things.

Demonstrate Your Flexibility And Creativity
You want to counteract stereotypes that suggest older workers do not have imagination. Discuss ways you solved problems and developed ideas in your most recent jobs to make your former employer more money or be more competitive.

Look and Act Young
Everyone knows people who are 50 who look and act as if they are 65 and people who are 65 who look and act as if they are 50. Dress in currently fashionable clothes and show enthusiasm for the opportunity. Exhibit a sense of excitement and energy, traits that younger individuals do not always show.

Stay Current And Embrace Technology
Do not appear as if the world has passed you by. If you do not have at least a rudimentary understanding of computers and how they work, take a class at night. Do not be afraid of computers. They are used in practically every application of work whether it is sales, marketing, accounting, etc. Employers cannot spend a lot of time teaching new employees how to use computers. They need employees to hit the ground running.

Source: Challenger, Gray & Christmas, Inc.©

Here is What Not to Do

Do not apologize or act defensive. Never again say the following: "Nobody really wants to hire someone my age." You cannot have a defeatist attitude or it will show during the interview. Employers want to hire people who are confident about themselves and their abilities, regardless of age.

Do not lead with your resume. It might show that you graduated from college before your interviewer was even born. Try to get the interview based on your experience and what you can offer the company. You cannot omit dates from the resume or stop the chronology early. It is a red flag to employers that something is amiss in your work history and will prompt questions from the interviewer. The goal is that by the time the interviewer asks to see your resume, you will have already won him or her over and age will not be an issue.

Do not tell the interviewer you took early retirement. You do not want to give the impression that you are thinking of retiring in a few years. First, it reminds them that you are older and second, that the idea of retirement is more important than the job for which you are interviewing.

Do not mention accomplishments from more than 10 years ago - unless they are extraordinary or the only example of experience you possess that meet the employer's needs. If you do mention a past accomplishment, talk about it as if it happened today.

Do not talk down to, patronize, or become convinced that you could not work for a younger manager. You do not want to make the interviewer feel that you are better than he or she. If you have a problem working for someone younger than yourself, resolve this conflict immediately because odds are the jobs you are interviewing for involve working for people who are younger than yourself. It is a reality you have to accept and deal with properly. Leave your ego at the door.

Source: Challenger, Gray & Christmas, Inc.©

Where Older Job Seekers Are Most Welcome

Health care - This sector is facing major labor shortages due to retirements, heavy turnover and a decline in the number of people entering the field. Jobs are available in most areas from home health care aides, who require a minimum amount of training, through registered nurses, who require far more training.

Teaching - Many school districts are so desperate for teachers that they are finding alternative and faster ways to certify interested candidates. Those who can apply their career background in the classroom are particularly in demand.

Consulting - Whether as an independent contractor or as part of a consulting firm, older job seekers can find ample opportunities to offer their experience and wisdom for a price.

Non-Profit Organizations – Those who are willing to volunteer or take a lower executive salary may find rewarding work in the non-profit sector. These organizations are starved for good leaders who not only have passion for the cause but the business acumen to manage operations.

Customer service/customer relations - With complaints of poor customer service growing in volume and frequency, more and more companies may look to older generations to make improvements. Those in their 50s, 60s and 70s were raised in an era when the customer was king (or queen) and therefore may have a better understanding of how to deliver superior customer service.

Small business - The welcome mat is out at these firms for experienced workers, especially those who have big-league corporate experience. They are viewed as being able to suggest new and improved ways of doing things because of their large-company backgrounds, and as being in a position to perform several different jobs.

Source: Challenger, Gray & Christmas, Inc.©

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