Job Changes at Older Ages: Effects on Wages, Benefits, and Other Job Attributes

One potential way to manage the rapidly growing costs of supporting older Americans is to increase labor supply at older ages. However, questions persist about the quality of available jobs. This study examines older Americans’ employment opportunities by studying job changes at older ages. Using data from the Health and Retirement Study, it compares wages, benefits, and other job attributes on new and former jobs for adults ages 45 to 75 who changed employers between 1986 and 2004. Because older people who choose to work after retiring voluntarily from long-term jobs may face different employment prospects than displaced older workers, the analysis considers how employment changes vary by the reasons workers give for job separations. Most people who switched employers at older ages moved to jobs that differed substantially from their previous jobs. The vast majority of older job changers moved into different occupations and industries. They were more likely to be self-employed, work part-time, and keep flexible hours at their new jobs than their old jobs. The new jobs generally involved less stress, less physical effort, and fewer managerial responsibilities. More older job changers enjoyed their new jobs than their old jobs. However, most older workers experienced sharp hourly wage reductions when they switched employers. They were also less likely to receive pension coverage or health benefits after they moved to new jobs. Although the findings do not raise concerns about the quality of post-retirement jobs, they suggest that older displaced workers face special challenges in the labor market.