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The Union Difference Is Even More Pronounced for Families of Color

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A new report from the Center for American Progress shows that union membership helps increase wealth and prosperity for families of color. The research comes on top of recent polls showing that more and more people are embracing the powerful benefits of collective bargaining.

Here are some of the key findings of the report:

When working people collectively bargain for wages, benefits and employment procedures, as union members they have higher wages, more benefits and more stable employment as a result of the bargaining agreement.

Household wealth is dependent on several factors, including income, savings, people having benefits like health insurance and life insurance.

Higher wages lead to higher savings, particularly when combined with job-related benefits, such as health and life insurance, since those benefits require union members to spend less out-of-pocket to protect their families.

Union members have higher job stability and protections, which lead to longer tenures at a workplace. This can lead to more savings as longer-tenured employees are more likely to be eligible for key benefits that accrue over time.

Nonwhite families with a union member in the household have a median wealth that is 485% as large as the median wealth of nonunion families of color.

Union members’ annual earnings are between 20 and 50% higher than those for nonunion members.

The benefits of union membership for nonwhite families is more significant than it is for white families because nonwhite workers tend to work at jobs with lower pay, fewer benefits and less stability. Union membership lowers the gap for everyone, but the gains are larger when you are starting from a lower level of income and benefits.

Union members also are less likely to experience a negative shock (a large change in income) and more likely to experience a positive shock.

Read the full report.

This blog was originally published by the AFL-CIO on September 11, 2018. Reprinted with permission.

About the Author: Kenneth Quinnell is a long-time blogger, campaign staffer and political activist. Before joining the AFL-CIO in 2012, he worked as labor reporter for the blog Crooks and Liars.


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Why Are Millennials Worse Off Than You Are?

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Why Are Millennials Worse Off Than You Are?

Ever feel like you’ve been set up to fail?

Millennials, as a generation, have been. And this isn’t the lament of over-indulged, basement-dwelling, spoiled brats complaining about having to pay student loans for a degree in the philosophy of memes. Data clearly shows that today’s young workers are basically screwed.

Millennials are doing worse than the previous two generations did at their age, even though they’re more likely to have a completed postsecondary education program and are part of the most productive workforce in memory.

The Guardian’s ongoing coverage of the financial struggles of the millennial generation paints a grim picture. Throughout Europe, Australia and the United States, today’s young workers are paid less, have higher debt and lower savings, and face a job market that’s still recovering from the recession and seems increasingly hostile to folks trying to start their careers.

Why is this happening?

A paper released last week by the Center for American Progress identifies the major reasons why young workers have it so much harder than their parents.

First, the labor market has not fully recovered from the recession, leaving a large pool of unemployed workers who can replace current workers who ask for better wages or working conditions. Why would a company that’s trying to maximize profit pay higher wages than they have to? Folks are just willing to work for less when the job market is weak. Crappy pay is better than none, right?

Second, it’s harder than ever to join or organize a union. Millennials’ union density is low, even though the benefits of union membership are significant. In fact, the union premium is higher for young workers than it is for any other age group. Without the worker power that comes from having a union, young workers are unable to negotiate for better pay and the kind of working conditions that make for a more productive and satisfying workplace.

So what are we going to do about it? What are you going to do about it?

This blog originally appeared in aflcio.org on March 11, 2016. Reprinted with permission.

Sarah Ann Lewis, esq., Senior Lead Researcher, Policy.


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Uncle Sam’s Hiring Practices

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Bruce VailA pair of reports released this week show that the federal government routinely ignores worker safety and labor law violations when awarding contracts to private companies—and that American taxpayers are cheated in the process.

The first  comes from the staff of the Senate Health, Education, Labor, and Pension (HELP) Committee, which conducted a yearlong investigation of federal contracting records. Unveiled Wednesday by HELP Chairman Sen. Tom Harkin (D-Iowa), the report provides a long list of specific companies that break safety and labor laws yet continue to receive big government contracts. In particular, it names 49 law-breaking contractors that got more than $81 billion from Uncle Sam in 2012 alone—including AT&T, Home Depot and GM.

The HELP report was paired with one from the Center For American Progress (CAP) Action Fund, a Democratic Party advocacy group, which examined whether government contractors are actually fulfilling their contracts. The CAP report found that a number of companies shortchange taxpayers through poor performance, and names specific companies that stand out in this respect, including Lockheed Martin and KBR. Some of these scofflaw companies, such as international oil giant BP, overlapped with the HELP report lists.

The CAP report was presented Wednesday by Chairman John Podesta in a joint appearance with Harkin at CAP’s Washington D.C. headquarters.

Both Harkin and Podesta trace the origin of their respective reports to a 2010 study by the U.S. Government Accountability Office (GAO) that analyzed official data on safety and labor law violations by government contractors. That GAO report found that known violators routinely received new government contracts. It failed to name the specific contractor companies guilty of violations, however, and the HELP report was designed to provide the public with those names, as well as to bring the information up to date through 2012, according to Harkin. CAP report co-author David Madland says his effort “provides a nice complement” to the HELP analysis by highlighting that the contracting problem is not solely a labor issue, but also one of good government administration and the concern of taxpayers over wasteful spending.

The names of federal contractors guilty of fatal worker safety violations will be familiar to most Working In These Times readers. Harkin began his presentation by pointing to the workplace deaths of 10 employees in three separate incidents at the facilities of laundry operator Cintas Corp., shipbuilder ST Engineering Ltd. and oil refiner Tesoro Corp.  Despite these deaths, all three companies received federal contracts in 2012, with Tesoro alone getting $463 million last year, the report states. A lengthier list of safety violators (some fatal, some non-fatal) includes international oil giant BP, commodities conglomerate Louis Dreyfus Group, beef and chicken processor Tyson Foods, auto manufacturers General Motors and Chrysler, and defense contractor General Dynamics. Eighteen such companies received almost $23 billion in federal contracts between 2006 and 2013, the report details.

Harkin pointed out that of 18 companies with terrible safety records, only one, BP, had ever been barred from federal contracts—and that suspension from new contracts was spurred by the environmental damage from the 2010 Deep Water Horizon oil rig explosion, not from the safety violations (although 10 workers were killed). Federal contracting officers routinely ignore the bad worker safety records of companies competing for government business, he added, and reforms are needed to correct the problem.

Similar issues are raised when analyzing the records on wage-and-hour law violations, according to both HELP and CAP. Again the HELP report unearths many household names from the Department of Labor records of companies obliged to make back wage payments to workers for legal violations. Among them are Hewlett-Packard Co., AT&T, General Dynamics, Nestle S.A., Lockheed Martin Corp., Cerberus Capital Management, and Home Depot Inc. A group of the 32 worst offenders received  $73.1 billion from the federal government between 2007 and 2012, the HELP report says.

Harkin conceded that not all violations are so serious that contractors should be punished by exclusion from government business. Some violations apparently arise from simple errors, unavoidable accidents or other benign sources, he said. However, when the Labor Department finds willful and repeated violations, it can assess civil penalties. Harkin suggested that the contractors penalized in this way should receive special scrutiny before any new contracts are awarded. HELP researchers came up with the names of Sprint Nextel Corp, UnitedHealth Group, Marriott International, C&S Wholesalers Inc., Acosta Inc. and University of Pittsburgh Medical Center as examples of contractors already assessed for “severe and repeated” violations of labor law. Together, those six companies received about $470 million in federal contracts in 2012 alone, the report said.

Like the safety violators, none of the wage-and-hour labor-law violators have been barred from the further government contracts, Harkin emphasized. “There is an existing legal requirement (that contractors obey labor law) but it’s clear to me that compliance is not being considered” when new contracts are awarded, he said.

CAP came up with some of the same names when it separately analyzed the government data and “found that the companies with the worst records of harming workers were also guilty of shortchanging taxpayers through poor performance on government contracts and similar business agreements in ways that defraud the government and otherwise provide a bad value for taxpayers.”

Cited in this regard were:

  • KBR, a construction and defense contractor notable for its work in Iraq and Afghanistan, which received $11.4 billion in contracts between 2009 and 2013
  • BP, the international oil giant, which received $4.6 billion in contracts (plus $433 million in offshore oil and gas leases) 2009-20013
  • Corrections Corporation of America or CCA, the nation’s largest operator of private prisons, which got $2.3 billion in government contracts 2009-2013
  • Akai Security, notable for its agreements to provide private security at Department of Justice facilities nationwide, which got $3.6 billion on government contracts 2009-2013
  • Wackenhut Services, whose subsidiary ArmorGroup of North America provides private security guards at U.S. embassies overseas, which got $1.7 billion 2009-2012
  • Lockheed Martin, a diversified military contractor, which got $170 billion 2009-2013
  • Group Health Cooperative, a health maintenance organization (HMO), which got $20.2 million 2009-2012

Both Harkin and Podesta were full of righteous indignation about this state of affairs at their joint appearance Wednesday, but neither offered any sweeping new proposals to fix the problem. The HELP report states that existing law allows federal contract administrators to exclude offending companies and suggests that improved reporting and database management by the Labor Department could make it easier to bar scofflaw companies. It also proposes that President Barack Obama issue several small-scale executive orders that would streamline the process of legally excluding some companies. The CAP conclusion was even less ambitious, merely blaming “weak guidance and lax enforcement of the regulations” for the chronic contracting problems.

It’s possible that in ignoring the possibility of stronger federal laws, both reports implicitly recognized the impracticality of any new legislative initiative in Washington’s current political environment.

CAP’s Madland tells Working In These Times that the new reports represent a continuing effort by Democrats to wrestle with the contracting issue. Reform proposals early in the Obama administration known as “high road” contracting were abandoned in the face of political opposition, he says, but the need to make reforms to the contract process remains. “Workers are being killed because companies cut corners. …The system is broken and needs to be reformed.”

This article was originally printed on Working In These Times on December 12, 2013.  Reprinted with permission.

About the Author: Bruce Vail is a Baltimore-based freelance writer with decades of experience covering labor and business stories for newspapers, magazines and new media. He was a reporter for Bloomberg BNA’s Daily Labor Report, covering collective bargaining issues in a wide range of industries, and a maritime industry reporter and editor for the Journal of Commerce, serving both in the newspaper’s New York City headquarters and in the Washington, D.C. bureau.


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Obama: â€Challenge of Our Time’ Is Making Economy Work for Everyone

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Image: Mike HallPresident Barack Obama today said that “a relentless, decades-long trend”—“a dangerous and growing inequality and lack of upward mobility…has jeopardized middle-class America’s basic bargain: that if you work hard, you have a chance to get ahead.”

The president declared that “making sure the economy works for every working American” is the “defining challenge of our time” and drives everything he does as president. His proposals to reduce inequality include an increase in the minimum wage and “ensuring that our collective bargaining laws function as they’re supposed to, so unions have a level playing field to organize for a better deal for workers and better wages for the middle class.”

In the speech at a community center in a low-income area of Washington, D.C., which was hosted by the Center for American Progress, Obama said, “[T]he premise that we are created equal is the opening line in the American story.” He highlighted a series of efforts throughout American history to put those words into practice—from Abraham Lincoln starting a system of land grant colleges; to Theodore Roosevelt fighting for an eight-hour day and worker protections; to Franklin D. Roosevelt fighting for Social Security, unemployment benefits and a minimum wage; to Lyndon B. Johnson fighting for Medicare and Medicaid.

“We built a ladder of opportunity to climb and stretched out a safety net so that if we fell, it wouldn’t be too far, and we could bounce back. As a result, America built the largest middle class the world has ever known. And for three decades after World War II, it was the engine of our prosperity.”

However, Obama said, “starting in the late 70s, the social compact began to unravel.”

A more competitive world lets companies ship jobs anywhere. And as good manufacturing jobs automated or headed offshore, workers lost their leverage, jobs paid less and offered fewer benefits. As values of community broke down and competitive pressures increased, businesses lobbied Washington to weaken unions and the value of the minimum wage.

As trickle-down ideology became more prominent, taxes were slashed for the wealthiest, while investments in things that make us all richer, like schools and infrastructure, were allowed to wither.

 

The result is “an economy that’s become profoundly unequal.” Income inequality has grown to record levels, with the top 1% having 288 time the net worth of the typical family, with CEO pay soaring from 20 to 30 times that of the average worker to more than 273 times and with the top 10% taking half of all income, up from a third since 1979. In addition, Obama outlined how upward mobility has been squashed at the same time.

The president said that growing inequality and lessened upward mobility “should offend all of us and it should compel us to action. We are a better country than this.” He highlighted that these trends are bad for our economy, pointing to studies that show that economic growth is more fragile in countries with greater inequality.

Obama then presented a “road map” of proposals to reduce inequality and restore economic opportunity:

  • Relentlessly push a growth agenda, making America a magnet for good, middle-class jobs in manufacturing and energy and infrastructure and technology, and ending incentives to ship jobs overseas;
  • Empower more Americans with the skills and education they need to compete in a highly competitive global economy;
  • Empower our workers. “It’s time to ensure our collective bargaining laws function as they’re supposed to so unions have a level playing field to organize for a better deal for workers and better wages for the middle class. It’s time to pass the Paycheck Fairness Act so that women will have more tools to fight pay discrimination. It’s time to pass the Employment Non-Discrimination Act so workers can’t be fired for who they are or who they love;
  • Target programs for the communities and workers who have been hardest hit by the economic change and the Great Recession; and
  • Revamp retirement to protect Americans in their Golden Years.

He said that “it was well past time” to raise the minimum wage for a growing service sector that includes “airport workers, and fast-food workers, and nurse assistants, and retail salespeople who work their tails off and are still living at or barely above poverty.”

Obama also called for renewing the extended unemployment insurance program for the long-term unemployed and protection of the Supplemental Nutrition Assistance Program that Republicans have targeted for cuts.

It makes a difference for a mother who’s working but is just having a hard time putting food on the table for her kids, [and] it makes a difference for a father who lost his job and is out there looking for a new one that he can keep a roof over his kids’ heads.

He also told congressional Republicans, who have blocked and continue to block action on the economy—from creating jobs to raising the minimum wage to ending tax breaks for corporations that ship jobs overseas:

You owe it to the American people to tell us what you are for, not just what you’re against….If Republicans have concrete plans that will actually reduce inequality, build the middle class, or provide more ladders of opportunity to the poor, let’s hear them.

Read the full speech here.

This article was originally printed on AFL-CIO on December 4, 2013.  Reprinted with permission.

About the Author: Mike Hall is a former West Virginia newspaper reporter, staff writer for the United Mine Workers Journaland managing editor of the Seafarers Log.  He came to the AFL- CIO in 1989 and has written for several federation publications, focusing on legislation and politics, especially grassroots mobilization and workplace safety.


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On Labor Day, Work to Save the Middle Class

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Leo GerardThis Labor Day feels gloomy. It’s a celebration of work when there is not enough of it, a day off when too many desperately seek a day on.

America has commemorated two Labor Days since this brutal recession began near the end of George Bush’s presidency in December of 2007. Now the relentless high unemployment, the ever-rising foreclosures, the unremitting wage and benefit take-backs have replaced American optimism and enthusiasm with fear and anger.

Happy Labor Day.

On this holiday, we can rant with Glenn Beck, kick the dog and hate the neighbor lucky enough to retain his job. Or we can do something different. We can join with our neighbors, employed and unemployed, our foreclosed-on children, our elderly parents fearing cuts in their Social Security lifeline and our fellow workers worrying that the furlough ax will strike them next. Together we can organize and mobilize and create a grassroots groundswell that gives government no choice but to respond to our needs, the needs of working people.

We can do what workers did during the Great Depression to provoke change, to create programs like Social Security and achieve recognition of rights like collective bargaining. These changes were sought by groups to benefit groups. In a civil society, people care for one another. And America is such a society – one where people routinely donate blood to aid anonymous strangers, children set up lemonade stands to contribute to Katrina victims and working families find a few bucks for United Way.

The self-righteous Right is all about individuals pulling themselves up by their bootstraps. That proposition – the do-it-all- by-yourself-winner-takes-all philosophy – clearly failed because so many Americans are jobless, homeless and too penniless to afford boots.

Over the past decade, the winner who took all was Wall Street. The banksters gambled on derivatives and other risky financial tomfoolery and won big time. Until they lost. And crashed the economy. After the American taxpayer bailed them out, those wealthy traders returned to making huge profits and bonuses based on perilous schemes.

Still, they believe they haven’t taken enough from working Americans. They’re lobbying to end aid for those who remain unemployed in a recession caused by Wall Street recklessness. And they’re demanding extension of their Bush-given tax breaks. This is the nation’s upper 1 percent, people who earn a million or more each year, the 1 percent that took home 56 percent of all income growth between 1989 and 2007, the year the recession began.

Since 2007, 8.2 million workers have lost jobs. Millions more are underemployed, laboring part-time when they need full-time jobs, or barely squeaking by on slashed wages and benefits. Since the recession began, the unemployment rate nearly doubled, from 5 percent to 9.6 percent, and that does not include those so discouraged that they’ve given up the search for jobs, a decision that is, frankly, understandable when there are only enough openings to re-employ 20 percent of the jobless. Five unemployed workers compete for each job created in this sluggish economy.

And American workers weren’t prepared for this downturn, having already suffered losses in the years before it began. The median income, adjusted for inflation, of working-age households declined by more than $2,000 in the seven years before the recession started.

At the same time, practices like off-shoring jobs and signing regressive international trade deals contributed to the loss of middle class, blue collar jobs. A new report, “The Polarization of Job Opportunities in the U.S. Labor Market,” by the Center for American Progress and The Hamilton Project, says:

“The decline in middle-skill jobs has been detrimental to the earnings and labor force participation rates of workers without a four-year college education, and differentially so for males, who are increasingly concentrated in low-paying service occupations.”

The recession compounded that, the report says:

“Employment losses during the recession have been far more severe in middle-skilled white- and blue-collar jobs than in either high-skill, white-collar jobs or low-skill service occupations.”

What that means is high roller banksters are living large; lawn care workers and waitresses subsist on minimum wage, and working class machinists and steelworkers are disappearing altogether.

The researchers found the U.S. economy is increasingly polarized into high-skill, high-wage jobs and low-skill, low wage jobs. America is losing the middle jobs and with them its great middle class.

No wonder the rising anger in middle America.

But fury doesn’t solve the problem. This Labor Day, we must organize to save ourselves and our neighbors. We must stop America from descending into plutocracy. We must demand support for American manufacturing and middle class jobs. That means terminating tax breaks for corporate outsourcers, ending trade practices that violate agreements and international law and punishing predator countries for currency manipulation that subverts fair trade by artificially lowering the price of products shipped into the U.S. while artificially raising the price of American exports.

We must demand support for American industry, particularly manufacturers of renewable energy sources like solar cells and wind turbines that create good working class jobs, increase America’s energy independence and reduce climate change.

We must insist on policies that support the middle class, including preserving Social Security and Medicare, extending unemployment insurance while joblessness remains high, and enforcing the health care reform law so that every American worker and family can afford and is covered by insurance.

On this Labor Day, we should all have a picnic, invite neighbors, friends and family, and over hot dogs and potato salad, organize to save the American middle class.

Mobilize to end the gloom and restore American optimism.

***

For help: the Union of the Unemployed, the AFL-CIO, USW, Working America. Join the One Nation March for jobs Oct. 2 in Washington, D.C.

About The Author: Leo Gerard is the United Steelworkers International President. Under his leadership, the USW joined with Unite -the biggest union in the UK and Republic of Ireland – to create Workers Uniting, the first global union. He has also helped pass legislation, including the landmark Canadian Westray Bill, making corporations criminally liable when they kill or seriously injure their employees or members of the public.


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Mixed News for Older Workers

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Older workers are increasingly relying on the labor market—rather than savings—to salvage their retirement prospects. The collapse of the financial sector wiped out an inflation-adjusted $2.8 trillion from 401(k)s and individual retirement accounts, or IRA, between September 2007 and December 2008. But even before that, workers were not saving enough to achieve a secure retirement. Millions of elderly workers have therefore been forced to postpone their retirement plans and depend upon work to provide income in their later years.

But the labor market is a very mixed bag for older workers. Those who currently have a job have been more effective than their younger counterparts at holding onto their positions in the current downturn; the real value of older workers’ median weekly earnings has grown more during the current recession than that of younger workers; and their unemployment rates—despite reaching record highs—are still considerably lower than the national average.

Simon Norwood, a construction worker who hasn't found work in months, poses in a garage apartment belonging to a friend in Little Rock, AK, on August 27, 2009. Workers 55 and older have a higher unemployment rate than anytime since 1948, and those who are unemployed are staying unemployed much longer. SOURCE: AP/Danny Johnston

Yet the news is bleak for older workers without a job. Workers 55 and older have a higher unemployment rate than anytime since 1948, and those who are unemployed are staying unemployed much longer. Given employers’ reluctance to start hiring again, it is likely that older workers will have to continue looking for work for months before finding a job.

Unemployment reaches record levels

Unemployment among older workers has peaked in the current recession. There has been a 134-percent increase in the number of workers over the age of 55 who are looking for work since December 2007, up from 843,000 to 2.0 million last month. In June 2009, the unemployment level of this age demographic peaked at 2.1 million—a number higher than anytime since 1948 when the Bureau of Labor Statistics began tracking that data. And the oldest workers—those over the age of 65—have also seen their unemployment levels rise, up to 447,000 last month from 197,000 in December 2007—a 127 percent increase.

In comparison, prime-aged workers—workers aged 25 to 54—saw their unemployment levels increase by 118 percent over the last 21 months, rising from 4.2 million to 9.1 million in August.

The age-55-and-older unemployment rate climbed to an all-time high in June 2009 of 7.0 percent, 3.9 percentage points higher than at the start of the current recession. This rate inched down to 6.8 percent last month, but that is still extraordinarily high for older workers. Workers 65 and older saw their unemployment rate reach 7.0 percent in July 2009, up 3.7 percentage points since December 2007, and higher than anytime since 1948. Their unemployment rate also inched down in August to 6.8 percent.

Despite the grim unemployment outlook, older workers have lower unemployment rates than younger workers. The unemployment rate for all workers in August was 9.7 percent, nearly 3 percentage points higher than the rates reached by older workers. Prime-aged workers—those aged 25 to 54—had an unemployment rate of 8.7 percent in August, up 4.7 percentage points since December 2007, and nearly 2 percentage points higher than the rates reached by older workers.

Older workers are working longer and in greater numbers

The aging baby boomer generation is reshaping the demographics of the U.S. population, and changing the face of the workforce. People over 55 account for 31 percent of the civilian population today, up from 23 percent in 1948. It is unsurprising then that older workers make up a greater share of the workforce today than any elderly generation of the past. Their employment rate is higher than any time since 1971, and they appear to be holding on to their jobs longer and more effectively than younger workers.

A Pew Research Center nationwide survey released yesterday found that a paycheck was not the only factor compelling older workers to remain in the labor force; respondents also cited psychological and social benefits as the main reasons for their continued employment. Younger workers, on the other hand, were found to be staying in school longer to earn a higher degree or have become discouraged at their job prospects and are dropping out of the labor market.

The inflow and outflow from the labor market in the last 21 months has shifted the composition of the labor force in favor of elderly workers. The number of workers over the age of 55 in the labor force has grown by 2.1 million since December 2007—an increase of 7.6 percent. The number of prime-aged workers in the labor force has declined by 608,000 over that same time period—a decrease of 0.6 percent. Younger workers have seen the sharpest declines, losing 608,000 labor force participants since December 2007—a decrease of 3.1 percent.

Workers 55 and older account for 18.8 percent of the labor force today—up from 17.6 percent at the start of the current economic recession—and higher than anytime since 1948. Their share of the workforce has increased by 7.1 percent over the last 21 months. In comparison, the share of prime-age workers in the workforce has declined 1.1 percent since the start of the Great Recession. Prime-age workers currently account for 67.3 percent of the workforce, down from 68.0 percent 21 months ago. Younger workers aged 16 to 24—whose share of the workforce has declined by 3.6 percent since December 2007—make up 13.9 percent of the workforce, down 0.5 percentage points from December 2007.

Elderly workers have experienced net gains in employment in recent months, especially when compared to younger workers. Workers 55 and older have gained 938,000 jobs since the start of the Great Recession, while workers between the age of 25 and 54 have lost a total of 5.5 million jobs.

Employment rates for older workers have also reached record levels. The employed share of workers over 55 climbed to 38.0 percent in the current recession, most recently in August 2008. This is a high not seen since 1970. The employment rate for this segment of the population was 37.3 percent last month, only marginally lower. The employed share of workers over 65 climbed to a record 16.5 percent in the current recession, most recently in October 2008. This is also a record not seen since 1970. And the employment rate for workers over 65 was 16.1 percent last month—down 0.4 percentage points from the current recession’s peak.

Older workers have also been relatively effective at holding onto their jobs in the current downturn. The employed share of workers over 55 has only declined 0.4 percentage points since December 2007, compared to a decline of 5.5 percentage points for workers between the ages of 16 and 24, and a decline of 4.2 percentage points for workers between the ages of 25 and 54.

Growth in real earnings

Older workers have experienced greater gains in real earnings value than younger workers in the current downturn, providing them with an additional cushion to endure the crisis. The real median weekly earnings for workers 55 and older have increased by 10.3 percent since 2007, and by 5.2 percent since 2008. Workers 65 and older have seen a 23.7 percent increase in real median weekly earnings since 2007, and an 11.2 percent increase since 2008.

In contrast, workers aged 16 to 24 have seen their real weekly earnings decline in real value by 2.8 percent since 2007, and by 0.9 percent since 2008. Real weekly earnings of prime-aged workers have increased by a modest 1.7 percent since 2007, and by 2.5 percent since 2008.

The Great Recession has decimated the retirement savings of older Americans and placed them in a very precarious position. Working later in life has traditionally been the fall back for those with inadequate retirement savings, but the labor market during the Great Recession isn’t all that great, which makes it a more difficult prospect. Older workers with a job may be doing better than their younger counterparts, but older workers without a job face an unprecedented challenge. Real solutions to this retirement crisis will require getting the labor market back on track and addressing the glaring inadequacies of our current retirement system.

See also:

David Madland is Director of the American Work Project at the Center for American Progress and Nayla Kazzi is Research Assistant at the Center for American Progress. For more on this topic, please visit our Economy page.

This article originally appeared in Center for American Progress on September 4, 2009. Re-printed with permission by the author.


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