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Why Are Older Workers At Greater Risk of Displacement?


  • Alicia H. Munnell
  • Steven A. Sass
  • Natalia A. Zhivan


The conventional wisdom says that older workers are less likely to be displaced than younger workers. While true in the past, the conventional wisdom is no longer true today; the advantage that older workers had has disappeared. This loss of relative job security is troubling. Once displaced, older workers are less likely to be reemployed, have less time to adjust their retirement plans, and are more likely to retire prematurely. Given the contraction of the nation’s retirement income system and rising longevity, these adverse effects make displacement increasingly injurious to older workers. This brief analyzes changes in the displacement of older and prime-age workers since the mid-1990s and the effect of three factors – tenure, educational attainment, and employment in manufacturing – identified as having a significant effect on displacement risk. The results show that all three factors contributed to the rising dislocation risk older workers face and their rising risk vis-à-vis prime-age workers. The brief proceeds as follows. The first section presents the three factors identified in the literature as affecting displacement. The second section reviews the data and methodology used to analyze the effects of these factors on the changing displacement risk of older and prime-age workers. The third section reports the findings, and the fourth section concludes.

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  • Alicia H. Munnell & Steven A. Sass & Natalia A. Zhivan, 2009. "Why Are Older Workers At Greater Risk of Displacement?," Issues in Brief ib2009-9-10, Center for Retirement Research, revised May 2009.
  • Handle: RePEc:crr:issbrf:ib2009-9-10

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    1. Alicia H. Munnell & Steven Sass & Mauricio Soto & Natalia Zhivan, 2006. "Has the Displacement of Older Workers Increased?," Working Papers, Center for Retirement Research at Boston College wp2006-17, Center for Retirement Research, revised Sep 2006.
    2. Daniel Rodriguez & Madeline Zavodny, 2003. "Changes in the Age and Education Profile of Displaced Workers," ILR Review, Cornell University, ILR School, vol. 56(3), pages 498-510, April.
    3. Alicia H. Munnell & Dan Muldoon & Steven A. Sass, 2009. "Recessions and Older Workers," Issues in Brief ib2009-9-2, Center for Retirement Research, revised Jan 2009.
    4. Lori G. Kletzer, 1998. "Job Displacement," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 115-136, Winter.
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