According to the Bureau of Labor Statistics, workers 45 and older had lower unemployment rates in 2008 than younger workers; however, older workers stayed unemployed longer than their younger counterparts.
From a story in The New York Times Magazine, the fact that older workers stayed unemployed longer was due to three beliefs by prospective employers:
- Older workers have higher health care costs.
- Older workers command higher salaries.
- Older workers are less productive and less open to risk.
To address the first issue: Insurers don’t exactly publicize their actuary tables, but older workers are charged more on individual plans. But, according to The U.S. News and World Report, there is little empirical evidence showing that insurers charge employers more in premiums for older workers. As a matter of fact, a law was passed in New York that prohibits insurers from charging rates based on age.
On the subject of higher salaries, well, I hope older workers would ask for higher salaries; they’ve been at the game a lot longer and bring a lot of real-world experience to the table. And you get what you pay for.
According to a report prepared for AARP by the human resources and financial consulting firm Towers Perrin, a worker who’s 50 or older will be more productive than someone younger who has less on-the-job experience.
And very recently, another research project show that “seniors” more than hold their own when it comes to risk-taking. According to a piece in The New York Times Magazine:
Gary Charness, an economics professor at the University of California, Santa Barbara, and Marie Claire Villeval, a colleague from the University of Lyon, published the results of a study in which they pitted “seniors” (those over 50) against “juniors” (those under 30) in three different decision-making tasks. These were formulated to test risk taking, competitiveness and cooperation. The seniors were also more cooperative, contributing risk-taking, which the researchers assessed via an investing game, the seniors invested slightly more than the juniors. Seniors (50 and over) performed better than juniors (30 and under) in several tests, including a competitive word game.
An interesting side note to the study came out in the cooperation section of the test: Groups with a mix of ages outperformed homogeneous groups. Charness concludes that it’s best to have a a range of ages in the office.