The national recession ended, officially, in mid-2009. Recovery has been slow and uneven, but the American economy has been on an upward trend since June of 2009. The following chart shows job growth in Indiana from the end of the recession until the end of 2013. (The fourth quarter of 2013 is the last period for which data are available for all the states I’m looking at.) The three lines in the chart represent job gains by three age groups during that four-and-a-half year window. And it is clear that the largest share of new jobs went to workers 55 and older.
(I’m using the Census Bureau’s Longitudinal Employer-Household Dynamics dataset, a good source for employment data by industry, local geographic area, and other dimensions. The bouncing you observe in each line is seasonal change, such as teachers taking summers off.)
The above chart depicts percentage change in employment. Each line starts at 100 percent of the jobs that age group had at the end of the recession. Increases are measured as a percentage change from that starting point. Doing it this ways makes the comparison easier to see.
In raw numbers, Indiana added 155,816 new jobs for people 55 and older, but only 71,831 jobs to people 22 to 34 and only 44,639 to people 35 to 54. These age groups aren’t exactly the same as the Millennial / Gen X / Boomer generational cohorts, but they are close enough to confirm that job growth is working against Millennials. Gen Xers are lowest, but they are few in number. There are just as many Millennials as Boomers, and just as many in the job market, less than half the new jobs went to Millennials.
The chart only depicts Indiana, which is a conservative rust-belt state that talks about biotech but actually builds warehouses. Let’s look at other states. Washington is the hip and vibey home of Microsoft and Starbucks. How do Millennials fare there?
Not much different. Well, how about Minnesota, which is listed in several sources as one of the best places for Millennials to live and work:
Again, no. Minnesota is actually a bit worse than Indiana, adding only 8% new jobs for 22-34 workers from the mid-2009 base compared to Indiana’s 10%. And the older-worker bias is worse in Minnesota, where the ratio was 27%/8% compared to Indiana’s 23%/10%.
Hold on, though. Economic opportunity isn’t distributed evenly across wide areas. Perhaps even though Millennials aren’t getting their share of jobs across Minnesota, they might be doing well in urban Minneapolis, which claims to be the best place for Millennials in America. Let’s see the jobs pattern in urban Hennepin County:
I looked at several more states and the trend is consistent everywhere. The greatest share of new jobs since the recession ended are going to workers 55 and older. The margin is very slight in North Dakota, where a boom based on oil fracking was going strong in 2013. (It’s waning now.) In Louisiana, the 35-54 group actually lost jobs.
The labor market is a complex and ever changing kaleidoscope. There isn’t a single explanation for why more jobs are going to older workers. In some cases, it is because the older worker is the best qualified applicant.
But discrimination is a factor, too. Before taking my current job at Purdue University, I was involved in labor market analysis and I talked with dozens of employers who were reluctant to hire young people. In some cases the employers were being practical: “It is awfully hard to know what a 19-year-old is going to do,” said one. He didn’t seem to have any particular prejudice – but his experience had shown that young people are more apt to quit unexpectedly. I also met hiring managers whose bias against young people was stronger. Many said plainly that they don’t like younger workers. Many of these adopted the practice of requiring “Three years work experience” for entry level positions. Employers who didn’t make the (unnecessary) requirement explicit would simply put young peoples’ resumes at the bottom of the stack.
Young people have heard all their lives that aggressive pursuit of higher education is mandatory for good jobs and good incomes. (I don’t disagree with that. I’ve certainly benefited from my advanced degree.) But the Millennials have got their eyes open. According to a new report by the Federal Reserve, only 41% of students believe their college investment will pay off. Another 23% believe the cost of college is greater than the lifetime benefit they’ll get from it. They persist because they think they’ll fall even further behind without a degree.
You may have noticed that I titled this post, “Job discrimination is no problem. Let me explain. I googled “age discrimination.” The first, second and fourth items on the resulting list were summaries of federal law. The third was a January, 2014 article from Forbes about age discrimination against older people. The fifth was on AARP’s site and focused, of course, on discrimination against older workers. Next was a Wikipedia article on Ageism, which is defined as prejudicial attitudes toward older people. On down the list, the articles all addressed discrimination against older people only, even though the evidence of actual hiring patterns shows a prejudicial pattern that benefits the over-55s.
That seemed unfair. But then I read what the US Equal Employment Opportunity Commission says:
The Age Discrimination in Employment Act (ADEA) only forbids age discrimination against people who are age 40 or older. It does not protect workers under the age of 40, although some states do have laws that protect younger workers from age discrimination.
It is not illegal for an employer or other covered entity to favor an older worker over a younger one, even if both workers are age 40 or older.
So, job discrimination against young people, which obviously is widespread and very substantial throughout America isn’t even considered to be discrimination according to federal law. It is “not a problem” because Congress is in the pocket of AARP and sanctions discrimination again young people.