Workers Over 65 Vie With Teens in Labor Market for First Time Since Truman
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U.S. employees old enough to retire are outnumbering their teenage counterparts for the first time since at least 1948, a signal of how generations are now having to compete with each other for scarce jobs.
The number of people aged 65 and older in the labor force - defined as those who are working or looking for work - has averaged 6.6 million in the first half of this year, more than the 5.9 million workers between 16 and 19.
"Older workers need to replenish their 401(k) plans, so those who have jobs are clinging to them rather than retiring," said Alice Munnell, director of the Center for Retirement Research at Boston College.
A decade ago, there were four million more teens working or seeking work than those 65 and older.
2006 marked the year the baby boomers began entering the 60 to 64 year old age group. This age group grew by 2 million since then, suggesting older workers may compete with teens for jobs for years to come.
Teens in the U.S. workforce peaked in 1978 at 9.7 million. 16 to 19 year olds looking for work over the last decade "have faced a labor market weakened by recessions, a diminishing number of federally funded summer jobs, and competition from other groups for entry-level job opportunities," according to a May 2010 report by Labor Department economist Teresa Morisi.
The ratio of older workers for every teen worker is now 1.13, compared with only 0.5 a decade ago.
The participation rate of those 65 and older has averaged 17.4% so far this year, compared with an average 12.9% in 2000. Meanwhile, the teenage participation rate has shrunk to an average 34.5%, from 52% a decade ago.
Older workers are a key group that have taken jobs from teens, the report notes.
In food preparation and serving, the top job category for teens, employment fell by 242,000 among 16 to 19 year olds while rising by 128,000 among those 55 and older between 2000 and 2009.
U.S. employers have responded to the jump in the minimum wage from $5.15 in 2007 to $7.25 in 2009 -- an increase of over $4,200 per year -- by cutting teenage workers, according to labor experts.
"There's been some teen jobs lost to that. Teens are not $4,000 more productive than they used to be," said Walter Wessels, economic professor at North Caroline State University.
The minimum wage has risen as the pace of inflation has slowed. Adjusted for inflation, the minimum wage is now the highest since 1982, according to data compiled by Bloomberg.