Three essays in late-life job displacement

Date of Completion

January 1999


Gerontology|Economics, General|Economics, Labor|Health Sciences, Public Health




Workers suffering late-life job displacement may be among the most vulnerable of all older Americans. Frequently, these workers suffer long jobless spells without salaries and other benefits of permanent employment. In addition, such economic hardship may not cease at re-employment for these workers. Frequently, displaced older workers experience substantial earnings losses in their post-separation employment. Job loss may also be predictive of subsequent poor health among this population. The economic deprivation and social consequences of job displacement in the years preceding retirement, when American workers typically accumulate the greatest proportion of the wealth that will finance their retirements, can be devastating to the physical and emotional well-being of such individuals. ^ This dissertation assesses the economic and health impacts of job displacement on older American workers. Using data from the first two waves of the Health and Retirement Survey (HRS), a national panel study of older individuals, I have investigated the following three research questions: (1) What role do personal attributes, pre-displacement industry characteristics, and labor market conditions play in the unemployment duration of older American workers? (2) What are the consequences of job displacement on post-separation earnings and net worth accumulation among these workers? (3) Is it possible that involuntary job loss contributes to adverse health outcomes for these individuals? ^ The three studies contained in this dissertation provide evidence that late-life job loss has measurable adverse consequences. In sum, the empirical findings suggest that, for older American workers, involuntary job loss results in prolonged spells of unemployment, significant earnings losses in post-separation positions, and negative health effects, measured by both increased physical disability and elevated depression. ^ From a practical standpoint, the findings of this dissertation are of some importance. Downsizing and increased globalization have had an immense impact on the employment of late-stage workers, and there exists an abundance of anecdotal evidence to support the findings presented in these essays. However research such as this, in which current statistical methods are used to estimate the effects examined, may be of greater value to politicians and other policy makers concerned with the problems encountered by older displaced workers. ^