Why Companies Need to Start Hiring Older Workers

Over the years, employment of older workers has increased dramatically. This segment of the population continues to grow, and their talents with it. Older workers hold a multitude of talents, including managerial, accounting, marketing, manufacturing, construction, and more.

According to the Bureau of Labor and Statistics, between 1977 and 2007, employment of workers 65 and over increased 101 percent, compared to a much smaller increase of 59 percent for total employment (16 and over). Employment of people 65 and over doubled while employment for everyone 16 and over increased by less than 60 percent.

In addition, the number of employed men 65 and over rose 75 percent, but employment of women 65 and older increased by nearly twice as much, climbing 147 percent. While the number of employed people age 75 and over is relatively small (0.8 percent of the employed in 2007), this group had the most dramatic gain, increasing 172 percent between 1977 and 2007.

These numbers are attributed to the fact that a big portion of the aging workforce is returning to the labor force out of retirement or simply staying in for a longer duration. The common retirement age is mid-60s; however, some workers are opting to work well into their 70s, assuming health permits.

Employers cannot ignore such a large workforce, and it's clear they have not been. The labor force participation rate for older workers has been rising since the late 1990s. Companies value the skill, loyalty, and wisdom  older workers bring to the table.

But companies aren't hiring enough older workers. The BLS reported recently that as of last December, more than half of all unemployed workers 45 to 54 years old have been out of work for six months or more, and among unemployed 55-to-64-year-olds, close to 60 percent have been searching for work for more than six months.

Experts say that while older workers have been favorable skills, employers continue to favor hiring younger workers instead. The reasons for this are debatable. But it's clear that older workers perform better across the range of relevant performance indicators. They have better skills, especially interpersonal skills, better attendance, and are more conscientious.

Some say older workers cost more in terms of insurance premiums and higher wages. But the wages are actually controlled by the employer, and he can choose to simply present the offer and await a response. And it should be noted that while older workers might use more health care, they also have fewer covered dependents, so total employer costs may not be so different.

According to a blog on the New York Times, author Alicia Munnell states that the real reason employers seem to prefer younger candidates has to do with perceptions of supervisors who often worry about how manage older subordinates: "How can I supervise someone who has more experience than I have, how do I motivate them when they are less concerned about the carrot of promotions or the stick of being fired?"