Tyler Durden, the pseudonymous ZeroHedge writer, connects this pattern to the recovery’s unimpressive wage growth: “Little wonder then why there is no wage growth as employers continue hiring mostly those toward the twilight of their careers: the workers who have little leverage to demand wage hikes now and in the future, something employers are well aware of.”
Do older workers really have “little leverage to demand wage hikes?” I think it probably depends on the worker and the job.
For relatively unskilled, repetitive work, employers will hire whoever is most productive and reliable. They’ll pay what it takes to keep those workers aboard and still make a profit. No offense to the younger generation, but the older generation doesn’t stay out and party and shows up ready to work.
Older people may simply be willing to work for less money, although I don’t think Barnes & Noble pays high salaries to any of its retail clerks. Some probably have other income sources like Social Security. Those aged 65+ have Medicare, which reduces the employer’s benefit headache. Younger workers have neither advantage.
Nonetheless, I’m still surprised to see younger workers losing so much ground. I hope it’s because they’re busy learning new skills. That’s what we really need.
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Read the original article The Gig Economy Is the New Normal on Mauldin Economics. Copyright 2015. Follow John Mauldin on Twitter.