More baby-boomers are putting off retirement, as the sour economy has sapped pension plans, 401(k)s and other savings, while life-expectancy has continued to rise. That’s led to some speculation that younger workers are getting squeezed out of the workforce and face a “millennial glass ceiling” while they’re in it.
But one recent study shows the opposite to be true: Older workers who stay in the workforce tend to help younger workers get more jobs and better-paying work.
The Center for Retirement Research looked at 1977-2011 data from the Current Population Survey. The study notes that labor force participation among elderly workers has increased since the 1990s. But after running the numbers, the researchers found no evidence that more employment of older people hurts younger people’s jobs prospects. “Indeed, the evidence suggests that greater employment of older persons leads to better outcomes for the young in the form of reduced unemployment, increased employment and a higher wage,” the report says.
How is this the case? “Job opportunities rise as older workers enter the market as consumers as well as workers. Older workers create new products and services, raise national income and increase demand for labor throughout the economy,” says Alicia Munnell, a Boston College professor who co-authored the study. Munnell compares the phenomenon to the impact of more immigrants in the workforce, which studies—like the highly regarded work of UC-Davis economist Giovanni Peri— have shown to increase economic growth without displacing job opportunities for native-born workers.
There are other ways that baby-boomers may be economic parasites, as Jim Tankersley has argued. But this isn’t one of them.