An aging population, coupled with low employment rates among Americans older than 62, poses severe challenges to the long-term sustainability of Social Security. Numerous reforms have been proposed to extend their working lives, including raising the retirement age. Such reforms may be unlikely to gain traction -- not because people are so eager to retire, but because age discrimination sharply limits job opportunities. After decades of debate, most labor economists today accept that discrimination has played a role in limiting job market opportunities for minorities and women. There's been a steady buildup of evidence that is hard to refute.
Companies speak with job seekers at a job fair in Pittsburgh. Companies speak with job seekers at a job fair in Pittsburgh. The federal Age Discrimination in Employment Act turns 50 this year -- about the age when many American workers begin to encounter the kinds of biases the law was intended to prevent. At this "milestone of middle age," quipped Victoria Lipnic, acting chair of the U.S. Equal Employment Opportunity Commission, the law is grappling with new forms of age discrimination in the Internet era. Research by EEOC, which received 20,857 claims of age discrimination last year, found that 65% of older workers say age is a barrier to getting a job.
It's important for older women seeking employment to understand the particular challenges they face in the labor market, says economist Teresa Ghilarducci. Editor's Note: For a recent Making Sen e segment, Paul Solman caught up with economist Teresa Ghilarducci to discuss why the job market is harder on aging women than aging men. We asked Ghilarducci to share some of her practical advice from her new book, "How To Retire With Enough Money and How To Know What Enough Is." The book also discusses retirement, savings, Social Security and why you should get rid of your financial planner. Below, Ghilarducci explains what older women face in the job market and some tips on how to beat the odds.
Middle-aged job seekers are up to three times less likely to get a job interview than a younger person applying for the same position, a new study has shown. A younger person is also likely to be paid more money - around 13 per cent more than their older rival - despite having up to a decade less experience. Researchers from Anglia Ruskin University and Cyprus found the age-based discrimination is also compounded by prejudice against ethnic minorities. Middle-aged job seekers are up to three times less likely to get a job interview than a younger person applying for the same position, a new study has shown. It found a 28-year-old white man is twice as likely to be interviewed for a job than a 50-year-old white woman and three times more than a 50-year-old black woman.
We develop tools for utilizing correspondence experiments to detect illegal discrimination by individual employers. Employers violate US employment law if their propensity to contact applicants depends on protected characteristics such as race or sex. We establish identification of higher moments of the causal effects of protected characteristics on callback rates as a function of the number of fictitious applications sent to each job ad. These moments are used to bound the fraction of jobs that illegally discriminate. Applying our results to three experimental datasets, we find evidence of significant employer heterogeneity in discriminatory behavior, with the standard deviation of gaps in job-specific callback probabilities across protected groups averaging roughly twice the mean gap. In a recent experiment manipulating racially distinctive names, we estimate that at least 85% of jobs that contact both of two white applications and neither of two black applications are engaged in illegal discrimination. To assess the tradeoff between type I and II errors presented by these patterns, we consider the performance of a series of decision rules for investigating suspicious callback behavior under a simple two-type model that rationalizes the experimental data. Though, in our preferred specification, only 17% of employers are estimated to discriminate on the basis of race, we find that an experiment sending 10 applications to each job would enable accurate detection of 7-10% of discriminators while falsely accusing fewer than 0.2% of non-discriminators. A minimax decision rule acknowledging partial identification of the joint distribution of callback rates yields higher error rates but more investigations than our baseline two-type model. Our results suggest illegal labor market discrimination can be reliably monitored with relatively small modifications to existing audit designs.