Should We Worry About Older Workers with Nontraditional Jobs?

Nontraditional jobs Ð defined here as those without health and retirement benefits Ð often concern policymakers. They worry that the lack of health insurance leaves workersÕ finances vulnerable to health shocks, while the lack of retirement plans will stunt savings. On the other hand, workers might use these jobs only infrequently to fill the gap between periods of more traditional employment, or they could use them to extend their careers past typical retirement ages. And, in any case, such workers may have access to benefits from family members or public programs. So, the question is: should we worry about these jobs? To answer the question, this brief synthesizes the findings of four recent Center studies on nontraditional jobs and older workers, a group that could be particularly vulnerable without employer benefits. The discussion proceeds as follows. The first section introduces the definition of nontraditional jobs used in this body of research. The second section discusses nontraditional jobs for workers approaching retirement Ð i.e., in their 50s and early 60s. It focuses on how frequently these jobs are used, whether workers are able to get health and retirement benefits elsewhere, and whether pressures like automation and trade increase the prevalence of these jobs. The third section turns to a different group of older workers Ð those of retirement age, i.e., in their mid- to late-60s. It examines whether the workers in this age group who use nontraditional jobs to extend their careers improve their financial situation. The final section concludes that some concern over nontraditional jobs is warranted. Most workers approaching retirement in these jobs use them frequently and, though they often find health insurance, they generally lack a viable alternative to save for retirement. However, workers in their 60s who switch to nontraditional jobs do improve their financial situation.