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Age Differences in Job Loss, Job Search, and Reemployment Richard - - PowerPoint PPT Presentation

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Age Differences in Job Loss, Job Search, and Reemployment Richard W. Johnson and Corina Mommaerts Urban Institute 12 th Annual Joint Conference of the Retirement Research Consortium August 5, 2010 Research Objective: Compare Older Workers to

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Age Differences in Job Loss, Job Search, and Reemployment

Richard W. Johnson and Corina Mommaerts Urban Institute 12th Annual Joint Conference of the Retirement Research Consortium August 5, 2010

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Research Objective: Compare Older Workers to Younger Workers

  • Likelihood of losing their jobs
  • Time to reemployment after job loss
  • Impact of job loss on characteristics of

future jobs

  • Job search activities
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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Survey of Income and Program Participation (SIPP)

  • 1996, 2001, and 2004 panels
  • 2½- to 4-year follow-up period
  • Spans 1996 to 2007
  • Respondents are interviewed every 4

months

– monthly retrospective data collected at each interview

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Job Loss Analysis

  • Person-month observations on wage and salary

workers age 18+

– self-employed workers are excluded

  • Remain in the sample until they separate from the
  • riginal employer
  • Lose job if separate from employer because of

layoff, slack work, bankruptcy, employer sold firm

  • Estimate discrete-time hazard models of job loss

– controls include demographics, job characteristics, job tenure, interactions with year and age

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Cumulative Probability of Male Wage and Salary Workers Losing Their Jobs, by Age

0% 2% 4% 6% 8% 10%

6 12 18 24 30 36 42 Months Observed on the Job

18-24 25-34 35-49 50-61 62+

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Cumulative Probability of Female Wage and Salary Workers Losing Their Jobs, by Age

0% 2% 4% 6% 8% 10%

6 12 18 24 30 36 42 Months Observed on the Job

18-24 25-34 35-49 50-61 62+

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Age 50+ Workers Are Less Likely to Lose Their Jobs, but Only Because of Job Seniority

Estimated Likelihood of Job Loss Relative to Workers Age 25-34, Men, by Presence of Controls

  • 21%
  • 11%

24%

  • 23%
  • 30%

2%

Year only +Demog, Job Chars +Tenure

50-61 62+

* p < .05 * * * * *

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Results Are Similar for Women

Estimated Likelihood of Job Loss Relative to Workers Age 25-34, Women, by Presence of Controls

  • 30%
  • 21%

6%

  • 13%
  • 23%

10%

Year only +Demog, Job Chars +Tenure

50-61 62+

* p < .05 * * * *

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Other Job Loss Results

  • Job loss is more common among:

– African Americans – Hispanics (women only) – those who didn’t finish high school (than grads) – those with fair or poor health – those working for small employers – part-time workers

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

More Job Loss Results

  • Job loss is less common:

– for college grads (than high school grads) – union members (women only) – as wages increase – as length of service increases

  • Being age 50-61 increased job loss

chances for men much more in 2001-2003 than earlier years

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SLIDE 11

Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Research Objective: Compare Older Workers to Younger Workers

  • Likelihood of losing their jobs
  • Time to reemployment after job loss
  • Impact of job loss on characteristics of

future jobs

  • Job search activities
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SLIDE 12

Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Reemployment Analysis

  • Person-month observations on displaced wage

and salary workers age 18+

  • Enter the sample when we observe job loss
  • Remain in the sample until they become

reemployed or drop out of labor force or survey

  • Estimate discrete-time hazard models of

reemployment

– controls include age, other demographics, year, characteristics of former job, economic status, receipt

  • f UI benefits, no. of months unemployed
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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Cumulative Probability of Displaced Wage and Salary Workers Becoming Reemployed, by Age

0% 20% 40% 60% 80% 100%

6 12 18 24 Months Since Job Loss

18-24 25-34 35-49 50-61 62+

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

The Chances of Becoming Reemployed Decline Steadily with Age

Estimated Likelihood of Becoming Reemployed, Relative to Workers Age 25-34

  • 10%
  • 3%
  • 39%
  • 18%
  • 50%
  • 50%

Men Women

35-49 50-61 62+

* * * * * * p < .05

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Other Reemployment Results

  • Reemployment is less common:

– for African Americans – for Hispanics – for those receiving UI benefits – as months since displacement increase

  • Holding other factors constant, there are no

significant differences by education

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Research Objective: Compare Older Workers to Younger Workers

  • Likelihood of losing their jobs
  • Time to reemployment after job loss
  • Impact of job loss on characteristics of

future jobs

  • Job search activities
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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

When Reemployed, 50+ Displaced Male Workers Experience Large Wage Losses

Median Hourly Wage on Old and New Jobs for Displaced Male Workers Who Become Reemployed

13.1 16.7 18.9 16.0 12.9 16.0 15.1 10.3

25-34 35-49 50-61 62+

Old New

20% 36% 4%

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Age Patterns of Wage Loss Are Less Consistent for Reemployed Displaced Women

Median Hourly Wage on Old and New Jobs for Displaced Male Workers Who Become Reemployed

13.1 12.7 13.3 9.0 10.7 11.4 10.5 7.6

25-34 35-49 50-61 62+

Old New

21% 16% 10% 18%

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Research Objective: Compare Older Workers to Younger Workers

  • Likelihood of losing their jobs
  • Time to reemployment after job loss
  • Impact of job loss on characteristics of

future jobs

  • Job search activities
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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Exploration of Job Search Activities

  • Current Population Survey data
  • Respondents report various job search

activities over the past four weeks

  • Pool data from March, April, May, and June

surveys in 2010

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Percentage of Unemployed Workers Engaged in Various Job Search Activities

1% 3% 3% 8% 16% 20% 28% 29% 77% Job training School employment center Check prof/union register Contact private agency Place or answer ad Contact public agency Contact friends/family Looked at ads Contact employer

Source: Authors’ computations from the March–June 2010, CPS

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Percentage of Unemployed Workers Who Contacted Employer Directly

84% 79% 74% 72% 62% 18-24 25-34 35-49 50-61 62+

Source: Authors’ computations from the March–June 2010, CPS

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Percentage of Unemployed Workers Who Contacted a Public Employment Agency

16% 21% 23% 21% 16% 18-24 25-34 35-49 50-61 62+

Source: Authors’ computations from the March–June 2010, CPS

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Percentage of Unemployed Workers Who Contacted Friends or Relatives

24% 28% 30% 31% 30% 18-24 25-34 35-49 50-61 62+

Source: Authors’ computations from the March–June 2010, CPS

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Mean Number of Job Search Methods Used by Unemployed Workers

1.9 2.0 2.0 2.0 1.7 18-24 25-34 35-49 50-61 62+

Source: Authors’ computations from the March–June 2010, CPS

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Urban Institute Program on Retirement Policy www.RetirementPolicy.org

Summary

  • Workers age 50+ are less likely than younger

workers to loss their jobs, but only because of their longer years of service with the employer

  • When workers age 50+ lose their jobs, it takes

them longer than younger workers to become reemployed

  • When displaced men age 50+ find work, they

suffer greater wage losses than younger men

  • Unemployed workers age 50-61 appear to search

for work as actively as younger workers