Has the Displacement of Older Workers Increased?

CRR Working Paper No. 2006-17

47 Pages Posted: 21 Nov 2008

See all articles by Alicia H. Munnell

Alicia H. Munnell

Boston College - Center for Retirement Research

Steven A. Sass

Boston College - Center for Retirement Research

Mauricio Soto

International Monetary Fund (IMF)

Natalia Zhivan

Boston College - Center for Retirement Research

Date Written: September 2006

Abstract

The employment of older workers into their mid-60s will be critical to their ability to ensure a secure retirement. One of the risks threatening the ability to work to older ages is being "displaced," with displacement defined as the elimination of the worker's job due to a shift in the demand for labor. Displacement can easily throw 50-year-old workers off course, disrupt their retirement saving plans, and lead to premature retirement.

This paper explores the relationship between job loss and age over the period 1984-2004 using the biennial Displaced Worker Supplement to the Current Population Survey. It finds that no major trends in the displacement of older workers have occurred over the 11 Displaced Worker Surveys conducted during the period. Re-employment rates for older workers appear to have improved. And the earnings loss associated with the displacement of older workers has not changed significantly. Two other significant findings relate to tenure and education. First, the historical protection that older workers appeared to have against displacement was due to tenure not to age per se. Controlling for tenure, the probability of displacement increases with age. Second, college education is no longer a source of significant protection in the world of displacement, and its importance has declined sharply for re-employment.

Suggested Citation

Munnell, Alicia and Sass, Steven A. and Soto, Mauricio and Zhivan, Natalia, Has the Displacement of Older Workers Increased? (September 2006). CRR Working Paper No. 2006-17. Available at SSRN: https://ssrn.com/abstract=1304736 or http://dx.doi.org/10.2139/ssrn.1304736

Alicia Munnell (Contact Author)

Boston College - Center for Retirement Research ( email )

Fulton Hall 550
Chestnut Hill, MA 02467
United States
617-552-1762 (Phone)

Steven A. Sass

Boston College - Center for Retirement Research ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

Mauricio Soto

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Natalia Zhivan

Boston College - Center for Retirement Research ( email )

Fulton Hall 550
Chestnut Hill, MA 02467
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
60
Abstract Views
647
rank
354,695
PlumX Metrics