United States Congress Joint Economic Committee
Building A Better Labor Market: Empowering Older Workers For A Stronger Economy
February 9, 2022
“Older Workers’ Loss of Bargaining Power Hurts the Economy”
EXECUTIVE SUMMARY: OLDER WORKERS’ LOSS OF BARGAINING POWER HURTS THE ECONOMY
Over 40 million people over the age of 55 work or would like to work but were pushed out of the labor force. The sheer scale and fast growth of older workers—45 percent of the 11.9 million jobs expected to be added to the economy between 2020 and 2030 will be filled by older workers—requires keen attention as the inequality among older workers grows. Some sectors, like home and personal health care, use older workers strategically, while others, like technology and finance, shun them. While a minority of older workers enjoy fulfilling jobs, most work because they have little retirement savings and face lowering wages, increasing job intensity, and being pushed out of the labor force entirely.
- Older workers are more likely to be working poor than their prime-age counterparts.
- Pay and job quality is eroding.
- Older workers are becoming a growing source of low-wage labor in large sectors with robust job growth, like warehousing, home and personal health care, and janitorial services. All of these jobs require bending, stopping, hard physical labor, little training, low pay, and few advancement opportunities.
- Older workers’ bargaining power has fallen over time and COVID only worsened these pre-existing trends.
- Eroding retirement security is a main reason the bargaining power of older workers is falling. It compounds a lack of choice that older workers face and may explain why they will take less and less pay to accept a job or change jobs.
If we don’t help older workers improve their bargaining power, younger family members will be pressed for time and money to help their impoverished elders while our long-term care system will be populated by precariat workers. Economic growth will continue to be impeded on the supply side because we do not match workers to jobs and on the demand side because of less spending power in older communities.
As older workers make up an increasingly large part of the U.S. labor market, it is long past time that we form an Older Workers Bureau (OWB) to hear from older workers and their employers, investigate their needs, coordinate the vast resources of the U.S. government, and modernize age discrimination laws and worker training. In addition, older workers’ bargaining power would be improved by policies like higher Social Security benefits, expanded and improved pensions, increased unionization a higher federal minimum wage, enforcing age discrimination laws, and making Medicare first payer.
Download the written testimony here.