AARP study: Age discrimination costs economy billions a year

Age discrimination

against people age 50 and older robbed the economy of $850 billion in 2018,

according to a new AARP report.

Research shows that

the 50-plus population contributed 40 percent of the U.S. Gross Domestic

Product, or GDP, in 2018, creating 88.6 million jobs and generating $5.7

trillion in wages and salaries through jobs held directly or indirectly,

according to information from the AARP and Economist Intelligence Unit.

But older workers

would have contributed a massive $850 billion more in 2018 to the GDP if they

could have remained in or reentered the labor force, switched jobs or been

promoted internally, according to the study.

In other words, the

elimination of that bias in 2018 would have increased the contribution of the

50-plus cohort to the GDP from $8.3 trillion to $9.2 trillion, according to the

study. The research also projects that the potential contribution of the older

population could increase by $3.9 trillion in a no-age bias economy, which

would mean a total contribution of $32.1 trillion to GDP in 2050.

“This important report

shows the cost to the entire economy of discriminating against older workers,”

said Debra Whitman, AARP’s executive vice president and chief public policy

officer. “The economy in 2018 could have been 4 percent larger if workers did

not face barriers to working longer.”

“Studies have shown

that older workers are highly engaged, with low turnover, and often serve an

important role as mentors,” Whitman added. “Their expertise helps businesses

and pays big dividends for the economy as a whole. Employers who embrace age

diversity will be at an advantage.”

The AARP report comes

on the heels of approval by the U.S. House of Representatives of bipartisan

legislation to combat age discrimination, the Protecting Older Workers Against

Discrimination Act.

“The House vote sends

a strong bipartisan message that age bias has to be treated as seriously as

other forms of workplace discrimination,” said Nancy LeaMond, AARP executive

vice president and chief advocacy and engagement officer, in a news release.

“Age discrimination is widespread, but it frequently goes unreported and

unaddressed.”

Backed by AARP, POWADA

would address an adverse 2009 Supreme Court decision that made it much more

difficult for older workers to prove claims of illegal bias based on age. The

legislation would restore long standing protections under the Age

Discrimination Employment Act, which covers workers aged 40 and over.

The new study included

a survey last July and August of 5,000 people age 50-plus to identify how they

have experienced age discrimination at work or while looking for work.

The survey analyzed:

• involuntary retirement due to age bias

• 50-plus workers involuntarily in part-time jobs

• missed opportunities for wage growth

• lost earnings following involuntary job

separation

• longer periods of unemployment compared to

younger workers

• people age 50 and older who dropped out of the

labor force, but want to continue working.