Tuesday, September 21, 2010

For the Unemployed Over 50, Fears of Never Working Again

This is bad for two reasons. 1) These are usually the higher income earning people who spend money on items that (like homes or remodeling) helps to stimulate the economy 2) These are the people that usually have mortgages and are at risk of default.

Forced early retirement imposes an intense financial strain, particularly for those at lower incomes. The recession and its aftermath have already pushed down some older workers. In figures released last week by the Census Bureau, the poverty rate among those 55 to 64 increased to 9.4 percent in 2009, from 8.6 percent in 2007.
Now this is the scary part.
Older people who lose their jobs take longer to find work. In August, the average time unemployed for those 55 and older was slightly more than 39 weeks, according to the Labor Department, the longest of any age group. That is much worse than in August 1983, also after a deep recession, when someone unemployed in that age group spent an average of 27.5 weeks finding work.
At this year's pace of an average of 82,000 new jobs a month, it will take at least eight more years to create the 8 million positions lost during the recession. And that does not even allow for population growth
With people working longer to retirement and a large population entering the workforce in the next 8 years.  This will reduce the demand for housing and some family unit may consolidate during recession.

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