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Job Changes at Older Ages: Effects on Wages, Benefits, and Other Job Attributes

  • Richard W. Johnson
  • Janette Kawachi

    ()

    (Urban Institute)

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    One potential way to manage the rapidly growing costs of supporting older Americans is to increase labor supply at older ages. However, questions persist about the quality of available jobs. This study examines older Americans’ employment opportunities by studying job changes at older ages. Using data from the Health and Retirement Study, it compares wages, benefits, and other job attributes on new and former jobs for adults ages 45 to 75 who changed employers between 1986 and 2004. Because older people who choose to work after retiring voluntarily from long-term jobs may face different employment prospects than displaced older workers, the analysis considers how employment changes vary by the reasons workers give for job separations. Most people who switched employers at older ages moved to jobs that differed substantially from their previous jobs. The vast majority of older job changers moved into different occupations and industries. They were more likely to be self-employed, work part-time, and keep flexible hours at their new jobs than their old jobs. The new jobs generally involved less stress, less physical effort, and fewer managerial responsibilities. More older job changers enjoyed their new jobs than their old jobs. However, most older workers experienced sharp hourly wage reductions when they switched employers. They were also less likely to receive pension coverage or health benefits after they moved to new jobs. Although the findings do not raise concerns about the quality of post-retirement jobs, they suggest that older displaced workers face special challenges in the labor market.

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    File URL: http://crr.bc.edu/working-papers/job-changes-at-older-ages-effects-on-wages-benefits-and-other-job-attributes/
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    Paper provided by Center for Retirement Research in its series Working Papers, Center for Retirement Research at Boston College with number wp2007-04.

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    Length: 31 pages
    Date of creation: Feb 2007
    Date of revision: Feb 2007
    Handle: RePEc:crr:crrwps:wp2007-04
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    1. Farber, Henry S., 1999. "Mobility and stability: The dynamics of job change in labor markets," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 37, pages 2439-2483 Elsevier.
    2. Louis S. Jacobson & Robert J. LaLonde & Daniel G. Sullivan, 1992. "Earnings losses of displaced workers," Working Paper Series, Macroeconomic Issues 92-28, Federal Reserve Bank of Chicago.
    3. Lazear, Edward P, 1979. "Why Is There Mandatory Retirement?," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1261-84, December.
    4. Lazear, Edward P & Moore, Robert L, 1984. "Incentives, Productivity, and Labor Contracts," The Quarterly Journal of Economics, MIT Press, vol. 99(2), pages 275-96, May.
    5. Richard W. Johnson & Gordon B.T. Mermin & Cori E. Uccello, 2006. "When The Nest Egg Cracks: Financial Consequences Of Health Problems, Marital Status Changes, And Job Layoffs At Older Ages," Working Papers, Center for Retirement Research at Boston College wp2005-18, Center for Retirement Research.
    6. Joanna Lahey, 2005. "Age, Women, and Hiring: An Experimental Study," NBER Working Papers 11435, National Bureau of Economic Research, Inc.
    7. Johnson, Richard W. & Steuerle, Eugene, 2004. "Promoting work at older ages: the role of hybrid pension plans in an aging population," Journal of Pension Economics and Finance, Cambridge University Press, vol. 3(03), pages 315-337, November.
    8. Ruhm, Christopher J, 1990. "Bridge Jobs and Partial Retirement," Journal of Labor Economics, University of Chicago Press, vol. 8(4), pages 482-501, October.
    9. Barbara A Butrica & Karen Elizabeth Smith & C. Eugene Steuerle, 2006. "Working for a Good Retirement," Working Papers, Center for Retirement Research at Boston College wp2006-8, Center for Retirement Research, revised May 2006.
    10. Gordon B.T. Mermin & Richard W. Johnson & Dan Murphy, 2006. "Why Do Boomers Plan to Work So Long?," Working Papers, Center for Retirement Research at Boston College wp2006-19, Center for Retirement Research, revised Nov 2006.
    11. Chan, Sewin & Stevens, Ann Huff, 2001. "Job Loss and Employment Patterns of Older Workers," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 484-521, April.
    12. Alicia H. Munnell & Steven A. Sass & Mauricio Soto, 2006. "Employer Attitudes towards Older Workers: Survey Results," Work Opportunity Briefs wob_3, Center for Retirement Research.
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