Fact Sheet

AARP Public Policy Institute

The Employment Situation, September 2014: Better News for Older Workers1 Sara E. RixAARP Public Policy Institute

9 The unemployment rate for the workforce aged 55 and older fell to 3.9 percent in September from 4.6 percent in August. It was also considerably below what it had been 1 year earlier, when 5.3 percent of the older workforce was without a job but looking for one.

9 The average duration of unemployment for older jobseekers fell to 41.7 weeks from 42.4 weeks between August and September and was nearly 14 weeks shorter than 1 year earlier (55.4 weeks).

9 The proportion of older people with jobs in September (38.3 percent) was up from both the previous month (38.1 percent) and September 2013 (38 percent).

Overview2

Nonfarm payroll employment rose by an estimated 248,000 in September. For all but 1 of the last 8 months (August), job growth has exceeded 200,000; in April, more than 300,000 jobs were created. As a result, nonfarm payroll employment is up by nearly 1.1 million workers since the onset of the Great Recession in December 2007 (figure 1).

What has not occurred, however, is much improvement in the proportion of workers with jobs (employment-to-population ratio). This figure for the total workforce aged 16-plus has barely budged for the past several months and remains well below what it was at the start of the recession—59 percent vs. 62.7 percent. On the whole, job growth has not kept pace with population growth.

Unemployment, on the other hand, fell between August and September from 6.1 percent to 5.9 percent, the lowest it has been for the total workforce since

July 2008. It is approaching the rate of 5.0 percent at the start of the recession.3

Labor Force Participation, Employment, and Unemployment in the Older Population

In many respects, the employment picture brightened for America’s older population in September (table 1). The labor force participation rate did dip slightly (40 percent in August to 39.9 percent in September), but 230,000 more older Americans had jobs in September than August, and the proportion employed inched up to 38.3 percent from 38.1 percent. This figure is somewhat higher than at the start of the recession (37.7 percent). About 217,000 fewer older people were unemployed—a figure quite comparable to the increase in the number employed. The unemployment rate for this age group fell from 4.6 percent to 3.9 percent (table 2). Older men and older women both experienced a decline in unemployment.

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Duration of Unemployment

At 41.7 weeks in September, average duration of unemployment for older jobseekers was somewhat lower than in August (42.4 weeks) but considerably lower than in September 2013 (55.4 weeks) (table 3 and figure 24). Jobseekers under age 55 had been unemployed for an average of 30.4 weeks in September, which was actually somewhat higher than in September (29.1 weeks) but also lower than 1 year ago (34.3 weeks).

As of September, about 43 percent of older jobseekers were long-term unemployed—that is, they had been out of work and looking for a job for 27 weeks or more—a slightly higher percentage than the month before (41 percent) but below September 2013’s nearly 51 percent. More than half of older jobseekers have been among the long-term unemployed at numerous times since the Great Recession.

Other Employment Indicators■ Some 3.8 percent of older workers

were employed part time for economic reasons (i.e., because of slack working conditions or because they could not find full-time work) in September, no change from the month before but still higher than at the start of the recession (2.4 percent).5 Older women were once again more likely than older men to be working part time for economic reasons in September (4.4 percent and 3.2 percent, respectively).

■ The number of older, unincorporated self-employed workers in nonagricultural industries was about 3.1 million in September;6 these self-employed workers comprised 9.8 percent of the older nonagricultural workforce, not much different from August’s 9.7 percent. These figures have fluctuated relatively little for years.

Figure 1Nonfarm Payroll Employment, December 2007–September 2014*

(seasonally adjusted; numbers in thousands)

Source: U.S. Department of Labor, Bureau of Labor Statistics, Total nonfarm employment from the Current Employment Statistics Survey (national) at http://data.bls.gov/pdq/querytool.jsp?survey=ce. Accessed on October 3, 2014. These numbers are from BLS’s establishment survey and will not be identical to data from the household survey.*Numbers for August 2014 and September 2014 are preliminary and may be revised.

The Employment Situation, September 2014: Better News for Older Workers

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■ Most older people who are out of the labor force say that they do not want a job (97 percent in September, a figure that has remained remarkably stable at least since the start of the recession). The number of older people who were out of the labor force but interested in work was approximately 1.7 million in September.7 At 230,000, the number

of older “discouraged” workers was somewhat lower than in August (241,000) but higher than the 195,000 of a year earlier.8 This figure remains well above what it was when the recession began in 2007, at which time only 53,000 older people were classified as discouraged workers.

■ About 4.2 percent of older workers held more than one job in September,

Table 1Selected Employment Indicators for the Older Population,

December 2007, September 2013, August 2014, and September 2014 (seasonally adjusted unless otherwise noted)

Age Indicator

December 2007

September 2013

August 2014

September2014

55+

Population (in 000s)* 69,628 82,880 84,974 85,181Labor force (in 000s) 27,102 33,278 33,954 33,968Labor force participation rate (%) 38.9 40.2 40.0 39.9Employment (in 000s) 26,243 31,521 32,405 32,635Share of population employed (%)** 37.7 38.0 38.1 38.3Unemployed (in 000s) 859 1,757 1,549 1.332Unemployment rate (%) 3.2 5.3 4.6 3.9Not in labor force (in 000s)* 42,469 49,553 51,281 51,115

55–64*

Labor force participation rate (%) 64.1 64.2 63.9 64.2Share of population employed (%)** 62.2 60.8 61.1 61.8Unemployment rate (%) 3.0 5.2 4.3 3.7Not in labor force (in 000s) 11,849 14,040 14,405 14,295

65+*

Labor force participation rate (%) 16.3 18.8 18.3 18.5Share of population employed (%)** 15.8 17.8 17.2 17.8Unemployment rate (%) 3.3 5.1 5.6 4.3Not in labor force (in 000s) 30,620 35,513 36,875 36,860

Source: U.S. Department of Labor, Bureau of Labor Statistics, Labor Force Statistics from the Current Population Survey (household survey data) at http://data.bls.gov/pdq/querytool.jsp?survey=ln. Accessed on October 3, 2014.*Not seasonally adjusted.**Employment-to-population ratio.

Table 2Unemployment Rate for the Labor Force Aged 16+ and 55+,

September 2013, August 2014, and September 2014

Sex AgeUnemployment Rate (%)

September 2013 August 2014 September 2014

Men and Women 16+ 7.2 6.1 5.955+ 5.3 4.6 3.9

Men 55+ 5.5 4.4 4.0Women 55+ 5.0 4.7 3.9

Source: U.S. Department of Labor, Bureau of Labor Statistics (BLS), The Employment Situation—September 2014, USDL-14-1796 (Washington, DC: BLS, October 3, 2014). Available at http://www.bls.gov/news.release/pdf/empsit.pdf.

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not much different from August (4.1 percent). Older women were about as likely as older men to be multiple jobholders (4.3 percent and 4.2 percent, respectively).

A Closer Look at the Older Workforce9

Workers and jobseekers aged 55 to 64 account for three-fourths of the older labor force. Their labor force participation rate is about three and a half times higher than that for people

aged 65 and older (64.2 percent vs. 18.5 percent in September). (See table 1.)

The proportion of older adults holding jobs varies dramatically by age as well, with those aged 55 to 64 far more likely to be employed. Each age group was more likely to be employed in September than a month earlier. In contrast to those aged 65 and older, however, the 55-to-64 age group was somewhat less likely to be employed in September than at the start of the recession; in fact, their

Figure 2Average Duration of Unemployment in Weeks by Age, January 2011–September 2014*

Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Labor Force Statistics, in Employment and Earnings Online at http://webcache.googleusercontent.com/search?q=cache:http://www.bls.gov/opub/ee/archive.htm and http://www.bls.gov/web/empsit/cpseea36.pdf. Accessed on October 3, 2014.*Annual averages.

Table 3Duration of Unemployment among Younger and Older Jobseekers,

September 2013, August 2014, and September 2014

Duration AgeSeptember

2013August

2014September

2014

Average (weeks)* Under 55 34.3 29.1 30.455+ 55.4 42.4 41.7

Long-term Unemployed (%)* Under 55 35.1 28.2 30.755+ 50.6 41.4 43.1

Source: Calculated from Bureau of Labor Statistics, Labor Force Statistics, Table A-36 in Employment and Earnings Online at http://www.bls.gov/web/empsit/cpseea36.pdf and Employment and Earnings Online at http://webcache.googleusercontent.com/search?q= cache:http://www.bls.gov/opub/ee/archive.htm. Accessed on October 3, 2014.*Not seasonally adjusted.

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employment-to-population ratio fell to as low as 59 percent in July 2011.

In September, both age groups were still more likely to be unemployed than they were at the start of the recession, but the unemployment rates were approaching levels at the start of the recession—3.7 percent vs. 3 percent for the 55–64 age group, and 4.3 percent vs. 3.3 percent for those aged 65 and older.

Conclusion

In several respects, September’s employment and unemployment numbers for the older population were more encouraging than they have been for some time. At 3.9 percent, the unemployment rate was below 4 percent for the first time since July 2008, approaching their December 2007 levels (3.2 percent for the aged 55-plus workforce). The number with jobs rose while the number unemployed fell by close to the same amount. The proportion of older adults with jobs increased slightly, while the proportion of involuntary part-time workers remained flat. At the same time, average duration of unemployment inched downward for older jobseekers.

Because monthly employment and unemployment figures can fluctuate

considerably, it is important not to place too much stock in a single month’s figures. Still, most of the indicators discussed in this Fact Sheet show improvements over a longer period. Employment statistics may not be back to where they were before the recession or where they would have been had the recession not occurred or been less severe, but circumstances are improving for many older Americans. Still, this positive news does not necessarily mean that the long-term unemployed are the ones who are getting jobs; it remains to be seen how they are faring in this recovering economy.

Note: Caution is urged in interpreting month-to-month changes in some of the employment figures. Not all figures are seasonally adjusted, and the numbers can and do fluctuate substantially over the short term because of sampling error or the small number of individuals in a particular category who may have been interviewed. Numbers over a longer period (e.g., beginning to end of the recession) or annually adjusted figures generally provide a more reliable picture.

The next update of this Fact Sheet will report on the employment situation as of December 2014.

Endnotes

1 Unless otherwise specified, “older” in this Fact Sheet refers to people aged 55 and older. Employment and unemployment figures are seasonally adjusted unless otherwise noted.2 Statistics in this Fact Sheet are from U.S. Department of Labor, Bureau of Labor Statistics (BLS), The Employment Situation—September 2014, USDL-14-1796 (Washington, DC: BLS, October 3, 2014); tables in BLS’s Employment and Earnings Online at http://www.bls.gov/news.release/empsit.nr0.htm; http://www.bls.gov/opub/ee/archive.htm, various years; BLS tables at http://www.bls.gov/web/empsit.supp.toc.htm and http://data.bls.gov/pdq/querytool.jsp?survey=ce; and BLS’s labor force statistics from the Current Population Survey at http://data.bls.gov/pdq/querytool.jsp?survey=ln. Some numbers in this Fact Sheet may differ from those reported in earlier Fact Sheets because of adjustments by BLS.3 Since December 2007, the population not in the labor force has increased by just over 13 million, about two-thirds of them aged 55 and older. (These numbers are not seasonally adjusted.)4 Figure 2 data go back only to January 2011 because that was when BLS changed its top coding of duration of unemployment from 2 years to 5 years. Before this change, any duration of unemployment greater than

The Employment Situation, September 2014: Better News for Older Workers

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2 years was coded as 2 years. See U.S. Department of Labor, Bureau of Labor Statistics, Changes to Data Collected on Unemployment Duration, at http://www.bls.gov/cps/duration.htm. 5 Refers to nonagricultural workers. Data are not seasonally adjusted.6 BLS publishes monthly self-employment figures only for unincorporated workers employed in their own business, profession, trade, or farm. (BLS regards self-employed workers who report being incorporated as employees of a corporation and thus classifies them as wage and salary workers.) Self-employment figures are not seasonally adjusted.7 Data in this section are not seasonally adjusted.8 Discouraged workers are not looking for work because they believe that no work is available or that there are no jobs for which they would qualify (e.g., employers would find them too old, they lack the necessary schooling/training). They are a subset of the marginally employed (i.e., people who are not in the labor force who want a job and are available for work and who have searched for work during the prior 12 months but not in the prior 4 weeks). See BLS at http://www.bls.gov/cps/lfcharacteristics.htm#discouraged. The numbers on discouraged workers are not seasonally adjusted. 9 Data in this section are not seasonally adjusted.

Fact Sheet 315, October 2014

AARP Public Policy Institute 601 E Street NW, Washington, DC 20049 www.aarp.org/ppi 202-434-3910, ppi@aarp.org © 2014, AARP. Reprinting with permission only.

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