[Marxism] In Hard Economy for All Ages, Older Isn’t Better ... It’s Brutal

Louis Proyect lnp3 at panix.com
Sun Feb 3 10:34:59 MST 2013


NY Times February 2, 2013
In Hard Economy for All Ages, Older Isn’t Better ... It’s Brutal
By CATHERINE RAMPELL

Young graduates are in debt, out of work and on their parents’ couches. 
People in their 30s and 40s can’t afford to buy homes or have children. 
Retirees are earning near-zero interest on their savings.

In the current listless economy, every generation has a claim to having 
been most injured. But the Labor Department’s latest jobs snapshot and 
other recent data reports present a strong case for crowning baby 
boomers as the greatest victims of the recession and its grim aftermath.

These Americans in their 50s and early 60s — those near retirement age 
who do not yet have access to Medicare and Social Security — have lost 
the most earnings power of any age group, with their household incomes 
10 percent below what they made when the recovery began three years ago, 
according to Sentier Research, a data analysis company.

Their retirement savings and home values fell sharply at the worst 
possible time: just before they needed to cash out. They are supporting 
both aged parents and unemployed young-adult children, earning them the 
inauspicious nickname “Generation Squeeze.”

New research suggests that they may die sooner, because their health, 
income security and mental well-being were battered by recession at a 
crucial time in their lives. A recent study by economists at Wellesley 
College found that people who lost their jobs in the few years before 
becoming eligible for Social Security lost up to three years from their 
life expectancy, largely because they no longer had access to affordable 
health care.

“If I break my wrist, I lose my house,” said Susan Zimmerman, 62, a 
freelance writer in Cleveland, of the distress that a medical emergency 
would wreak upon her finances and her quality of life. None of the three 
part-time jobs she has cobbled together pay benefits, and she says she 
is counting the days until she becomes eligible for Medicare.

In the meantime, Ms. Zimmerman has fashioned her own regimen of home 
remedies — including eating blue cheese instead of taking penicillin and 
consuming plenty of orange juice, red wine, coffee and whatever else the 
latest longevity studies recommend — to maintain her health, which she 
must do if she wants to continue paying the bills.

“I will probably be working until I’m 100,” she said.

As common as that sentiment is, the job market has been especially 
unkind to older workers.

Unemployment rates for Americans nearing retirement are far lower than 
those for young people, who are recently out of school, with fewer 
skills and a shorter work history. But once out of a job, older workers 
have a much harder time finding another one. Over the last year, the 
average duration of unemployment for older people was 53 weeks, compared 
with 19 weeks for teenagers, according to the Labor Department’s jobs 
report released on Friday.

The lengthy process is partly because older workers are more likely to 
have been laid off from industries that are downsizing, like 
manufacturing. Compared with the rest of the population, older people 
are also more likely to own their own homes and be less mobile than 
renters, who can move to new job markets.

Older workers are more likely to have a disability of some sort, perhaps 
limiting the range of jobs that offer realistic choices. They may also 
be less inclined, at least initially, to take jobs that pay far less 
than their old positions.

Displaced boomers also believe they are victims of age discrimination, 
because employers can easily find a young, energetic worker who will 
accept lower pay and who can potentially stick around for decades rather 
than a few years.

“When you’re older, they just see gray hair and they write you off,” 
said Arynita Armstrong, 60, of Willis, Tex. She has been looking for 
work for five years since losing her job at a mortgage company. “They’re 
afraid to hire you, because they think you’re a health risk. You know, 
you might make their premiums go up. They think it’ll cost more money to 
invest in training you than it’s worth it because you might retire in 
five years.

“Not that they say any of this to your face,” she added.

When older workers do find re-employment, the compensation is usually 
not up to the level of their previous jobs, according to data from the 
Heldrich Center for Workforce Development at Rutgers University.

In a survey by the center of older workers who were laid off during the 
recession, just one in six had found another job, and half of that group 
had accepted pay cuts. Fourteen percent of the re-employed said the pay 
in their new job was less than half what they earned in their previous job.

“I just say to myself: ‘Why me? What have I done to deserve this?’ ” 
said John Agati, 56, of Norwalk, Conn., whose last full-time job, as a 
merchandise buyer and product developer, ended four years ago when his 
employer went out of business.

That position paid $90,000, and his résumé lists stints at companies 
like American Express, Disney and USA Networks. Since being laid off, 
though, he has worked a series of part-time, low-wage, temporary 
positions, including selling shoes at Lord & Taylor and making sales 
calls for a limo company.

The last few years have taken a toll not only on his family’s finances, 
but also on his feelings of self-worth.

“You just get sad,” Mr. Agati said. “I see people getting up in the 
morning, going out to their careers and going home. I just wish I was 
doing that. Some people don’t like their jobs, or they have problems 
with their jobs, but at least they’re working. I just wish I was in 
their shoes.”

He said he cannot afford to go back to school, as many younger people 
without jobs have done. Even if he could afford it, economists say it is 
unclear whether older workers like him benefit much from more education.

“It just doesn’t make sense to offer retraining for people 55 and 
older,” said Daniel Hamermesh, an economics professor at the University 
of Texas in Austin. “Discrimination by age, long-term unemployment, the 
fact that they’re now at the end of the hiring queue, the lack of time 
horizon just does not make it sensible to invest in them.”

Many displaced older workers are taking this message to heart and 
leaving the labor force entirely.

The share of older people applying for Social Security early spiked 
during the recession as people sought whatever income they could find. 
The penalty they will pay is permanent, as retirees who take benefits at 
age 62 — as Ms. Zimmerman did, to help make her mortgage payments — will 
receive 30 percent less in each month’s check for the rest of their 
lives than they would if they had waited until full retirement age (66 
for those born after 1942).

Those not yet eligible for Social Security are increasingly applying for 
another, comparable kind of income support that often goes to people who 
expect never to work again: disability benefits. More than one in eight 
people in their late 50s is now on some form of federal disability 
insurance program, according to Mark Duggan, chairman of the department 
of business economics and public policy at the University of 
Pennsylvania’s Wharton School.

The very oldest Americans, of course, were battered by some of the same 
ill winds that tormented those now nearing retirement, but at least the 
most senior were cushioned by a more readily available social safety 
net. More important, in a statistical twist, they may have actually 
benefited from the financial crisis in the most fundamental way: 
prolonged lives.

Death rates for people over 65 have historically fallen during 
recessions, according to a November 2011 study by economists at the 
University of California, Davis. Why? The researchers argue that weak 
job markets push more workers into accepting relatively undesirable work 
at nursing homes, leading to better care for residents.




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