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Over 50 and Unemployed is the New Black
There have been numerous studies showing deliberate employment discrimination against Blacks over decades. A 2010 Pew study that was repeated in 2016 showed the disparity in glaring clarity. While the rate of degreed African Americans matched their white counterparts in proportion to their population, the rate of hiring those same graduates remained at half that of whites. That disparity continues to this day and affects home purchases and therefore family asset values. It is completely intentional.
The Parallels in Perception are Striking
What is the surprise today is that the same effect is now being seen in older white Americans, even those with advanced degrees. There are currently 7M Americans unemployed, about 15% of them over 65, and 6M jobs currently available that they are not being considered for. The statistics are here for the reader to review at their leisure.
There were 145M people employed in 2008. That total represented about 66% of the number of people who listed themselves as able to work. By 2016, there were 151M people employed, a rise of 3.6%, while the labor participation rate had dropped by the same percentage. That means that employers around the country ignored the new labor coming into the workforce and dropped the older members with not intent to replace them. Those older workers have now become unemployable just as African Americans have been for decades.
Employers LOVE Recessions
There have been countless recessions in this country as it is a by-product of a capitalist economy. You live by the prospect of making a fortune, and die by it as well. Each one allows employers the license to make even more profit than they could before it, if they have product to sell or a confirmed demand for their product. If they have product to sell, they have inventory that will get them through the downturn so survival is not the issue. The issue is payroll, and the solution is can they still produce their current volume with a lower payroll. The answer is always a resounding YES. The solution is equally simple, cut the salary or the position of the highest paid producers. Why would they cut all that experience? Because they believe the position does not require that much skill to perform. Therefore, young guns, that can be hired at a fraction of the cost of the laid-off personnel, are trained to do the same work. The payroll goes down, company insurance costs drop, and profits skyrocket. When the economy returns, the older workers are rehired at far lower salaries and the company wins again. It is a pretty simple formula that has been repeated time and time again.
Sometimes though, those workers are NOT rehired. The reasons can be many. From companies believing their current younger workforce is producing enough to the company liking how its younger workforce looks and not wanting to spoil the chemistry by allowing older workers back in. Then there are the psychological issues among the management. Younger management does not have the confidence or skill to manage workers that are older than them and prefers the bias of not hiring them in the first place to avoid the issue. It is an illegal bias, but it is pervasive in the economy and has been for decades.
Indeed Corporation to the Rescue?
Indeed Corp, the job aggregating company had now created ads to offset this issue. Their ad is here. The problem is well known, but the solution is not simple. Health insurance costs alone would deter any hiring manager from employing a worker over 50 over one in their 20s. And that is not due to potential health risks. That is solely due to the costs a company would incur in their group health plan for older workers overall. However, one offset to that problem is that any worker can choose to opt out of the company group plan and choose a health plan off an exchange. That would save the company that cost which could alleviate that concern in hiring that older worker, but then the cost of that health insurance is on the shoulders of the worker which means they have to negotiate a higher salary to pay for it. That could prove problematic, but it is better than not being considered at all.
The more these commercials run, the better the market is likely to improve as public shame may have an effect on companies looking to add staff.