Older Workers – Rehired, But Paid Less
Earnings at work are expected to be at their highest level in the years leading up to retirement, but that is not the case for plenty of today's older employees.
Many who have been pushed out of their jobs due to the struggling economy, but managed to find another occupation, are making a lower salary than they previously had, research shows.
According to a 2015 study from AARP Public Policy Institute of older workers who were unemployed at some point during the past five years, nearly half of the reemployed respondents said they are currently earning less than what they earned at their last job. For some, it was only due to the fact that they were working fewer hours.
Joy Schneer, professor of management at Rider University, said employment gaps can have a long-time impact on earnings, no matter the reason, and that goes for all ages.
"Basically there is a bias against people who are unemployed," Schneer said. "When an organization is looking to hire, they're looking to hire people who are currently employed. That's why they use headhunters."
But Schneer calls this a fallacy, noting plenty of hard workers lose their jobs through no fault of their own.
"Companies downsize, companies merge, companies move," she said. "There are all kinds of reasons why people may find themselves out of work that have nothing to do with their capability."
In Schneer's research, she found an employment gap as small as six or seven months can sound the alarm for anyone looking through resumes. She said people should attempt to fill those gaps with internships or volunteer work - something that proves one is engaged in the profession.
The report also recognized a high percentage of older reemployed workers who needed to change occupations or fields, possibly to find more rewarding work or just so they can get back to making money, however possible.