Motoko Rich writes in the New York Times that older unemployed workers may never work again:
Of the 14.9 million unemployed, more than 2.2 million are 55 or older. Nearly half of them have been unemployed six months or longer, according to the Labor Department. The unemployment rate in the group—7.3 percent—is at a record, more than double what it was at the beginning of the latest recession.
After other recent downturns, older people who lost jobs fretted about how long it would take to return to the work force and worried that they might never recover their former incomes. But today, because it will take years to absorb the giant pool of unemployed at the economy’s recent pace, many of these older people may simply age out of the labor force before their luck changes.
I cannot accept an argument that businesses do not desire older workers. Conventionally, a business might choose to hire young because of a belief that a more experienced candidate would demand a higher salary. Thus, even though a younger hire would require more in the way of sunk costs (training, etc.), he or she would make up for it with lower pay.
This argument no longer holds true. Do you think for a minute that anyone, no matter the age, who finds himself or herself unemployed for an extended period of time has any leverage to make salary demands? Thus, businesses are in a position to hire more experience for less pay. Assuming starting salaries are equal, which candidate would you hire: the 25-year-old with scant experience, or the 50-year-old with decades of experience? The former will cost your business time and money in training, along with lost productivity. The latter will bring your company a skill-set that will let him or her hit the ground running with little or no training. To me, the decision is a no-brainer. For this reason, I simply cannot accept Mr. Rich’s argument that those 50 and older might find themselves unemployed in perpetuity.