INCREASING THE AGE OF MANDATORY RETIREMENT AND THE IMPACTS ON JOB MOBILITY IN RHODE ISLAND

Abstract

State economic development planning involves a complex series of interrelationships among many different areas. While land uses, transportation networks and economic conditions receive the majority of attention in most economic development planning, human resources are an important and often underestimated resource. In 1978, the Age Discrimination in Employment Act of 1967 was amended to allow workers to retire at age 70. Since worker retirements have historically created many job opportunities for younger workers, including both internal promotions and employment opportunities\ for workers entering the labor force f o r the first time, serious questions have been raised as to the impact of this legislation on the job mobility opportunities f or younger workers, women and minorities . It has been speculated that a decrease in the job mobility opportunities for these groups will accelerate out-migration from Rhode Island, a development that will negatively affect the economic health and vitality of the state. This research project will examine the impact of raising the age of mandatory retirement on the above mentioned groups of workers within the Rhode Island manufacturing community. In order to accurately assess the impacts, a mail survey of 107 manufacturing firms located in Rhode Island was conducted, which provided a 79 percent return of all questionnaires. The results of this survey indicate that job mobility for younger workers will be impaired by allowing older workers to work for longer periods of time. In addition, employers predict that under continuing high rates of inflation, the t rend toward early retirement before age 65 will be completely reversed.