Monday, August 13, 2012

Study: Labor Force Participation and Increased Participation by Older Workers

The Urban Institute has released a report suggesting that changing age demographics have powerful implications for the shape of the nation's work force, but that "formal models of labor force participation fail to take into account that as the relative supply of younger workers declines, employers will increasingly turn to older workers to meet their demand for labor to provide goods and services." According to "Correcting Labor Supply Projections for Older Workers Could Help Social Security and Economic Reform," by C. Eugene Steuerle and Caleb Quakenbush, increased labor force participation among older workers can add to the solvency of Social Security and the broader federal budget. Policymakers in both the public and private sectors can accommodate this trend by removing barriers that discourage hiring and retaining older workers.
Older workers are to the first half of the 21st century what women were to the last half of the 20th: the largest underused source of labor and human capital in the economy. Few policymakers are taking this extraordinary possibility into account in their reform packages. In an increasingly informationand service-based economy, older workers represent a valuable source of knowledge and experience that employers will tap, especially if Social Security and related economic reforms attempt to channel rather than obstruct these forces.
Source: Urban Institute Publication News (August 10, 2012)

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