Ageism and Age Discrimination in the Labour Market: A Macrostructural Perspective

91© The Author(s) 2018 L. Ayalon, C. Tesch-Römer (eds.), Contemporary Perspectives on Ageism, International Perspectives on Aging 19, https://doi.org/10.1007/978-3-319-73820-8_6 Chapter 6 Ageism andAge Discrimination intheLabour Market: AMacrostructural Perspective JustynaStypińska andPirjoNikander 6.1 Introduction Ageism and age discrimination in the labour market have been topics of scholarly interest since the early twentieth century. Today, in markedly different economic conditions, with increasingly globalised labour markets, the victories and failures of workers’ movements, and the changing conditions of the European welfare state, the problem of unequal and negative treatment of older workers still prevails. This chapter looks at the phenomenon of age discrimination and ageism in the labour market from a socio-political perspective and draws attention to deciding factors in its emergence. We add to the individualistic and micro accounts adopted by psychological research (see Lev etal. 2018; Chap. 4, in this volume) and the meso level studies of organisation and work environment conditions (see Naegele etal. 2018; Chap. 5, in this volume) by examining the role of macrostructural processes and transformations to identify their link to the persistence of ageism and age discrimination in contemporary labour markets. First, we provide an overview of the most common conceptual understandings of ageism and age discrimination in employment. Second, we investigate the dynamics between the phenomena of ageism and age discrimination and a range of socio-political contexts, cultural settings, and legal and economic conditions. We then discuss the costs and consequences of age discrimination in employment, and examine various policy responses to these costs and consequences. J. Stypińska (*) Free University Berlin, Berlin, Germany e-mail: [email protected] P. Nikander University of Tampere, Tampere, Finland e-mail: [email protected] 92 6.2 Ageism andAge Discrimination intheLabour Market: Key Theoretical Distinctions The concepts of age discrimination and ageism in the labour market have been variously defined and conceptualized in the literature. According to Palmore (1999), “Age discrimination may take the form of refusal to hire or promote older workers, or forcing retirement at a fixed age regardless of the worker’s ability to keep working” (p.119). Macnicol (2006) defined age discrimination as “the use of crude ‘age proxies’ in personnel decisions” (p.6), and Carmichael etal. (2011) proposed a definition based on actual experiences of older workers who themselves define workplace age discrimination as “not being allowed to do something you are capable of or willing to do just because of your chronological age” (p.122). The definition based on subjective perception of age discrimination allows for improved understanding of phenomenological aspects of how ageism operates, casting more light on the individual experiences of older workers. Another significant distinction was introduced with the tripartite definition of ageism that is in frequent use especially among psychologists (Cuddy and Fiske 2000; Levy and Banaji 2004). This model assumes ageist attitudes as constituted of three mechanisms: prejudice (affective), discrimination (behavioural), and stereotyping (cognitive). Here age discrimination is differentiated from the general concept of ageism as it represents only those elements that have a behavioural and externally manifested character. This partition helped enhance the understanding of ageism and age discrimination and was adopted by McMullin and Marshall (2001), who suggested two further distinct dimensions of ageism: “ageist ideology” and “ageist behaviours.” Ageist ideology includes negative stereotypes, beliefs, and attitudes; and ageist behaviours refer to behaviours that exclude certain people and place them in a disadvantaged situation relative to others on the basis of their chronological age (McMullin and Marshall 2001). This distinction is especially useful when referring to the legal prohibition of age discrimination in employment (Macnicol 2010). A key distinction based on empirical research that follows is that biased ageist attitudes may, but do not necessarily, lead to discrimination (Furunes and Mykletun 2010). Thus, ageism can exist without age discrimination. To better comprehend the behavioural component of ageism (age discrimination), its specific manifestations in the labour market need to be discussed. Studies point to several different types of age discrimination. The first type could be defined as those behaviours which occur in strict relation to the employment status of the worker, i.e. the hiring and firing decisions of employers. Refusing to hire an older person or firing someone because of his or her age form the bluntest type of age discrimination. A plethora of research shows a preference among employers to hire younger workers while placing older ones in a disadvantaged position already in the recruitment process (Malinen and Johnston 2013). The second area where ageism J. Stypińska and P. Nikander 93 manifests is in practices occurring within the workplace. Furunes and Mykletun (2010) identified several such practices: being paid less than younger workers, being left out of promotions, not being accepted to training programmes, and being left out of companies’ modernisation processes. Stypińska and Turek (2017) distinguished between two types of age discrimination in the labour market: soft and hard. Hard discrimination refers to the types of discrimination mentioned above, whereas soft discrimination consists of practices that occur in the interpersonal sphere and in the general atmosphere of the workplace; it is also not directly prohibited by law. Examples of these include hearing ageist jokes or remarks; being treated disrespectfully by employers, co-workers or clients; receiving lower evaluation of work outcomes; hearing that “you are too old for something”; or being humiliated or intimidated because of your age (Stypińska and Turek 2017). This is by no means an exhaustive list, but rather examples of possible manifestations of age discrimination on the level of personal experiences. An important concept in ageism studies is institutional ageism, which refers to a bias against or in favour of (see positive ageism below) actions inherent in the operation of any of society’s institutions, including schools, hospitals, police, and the workplace (Wilkinson and Ferraro 2004). Institutional ageism has been explained by Palmore (1999) as a “policy of institutions or organizations, which is discriminatory in a positive or negative way towards older persons” (p.44). One standard example of institutional ageism in the area of employment is the statutory retirement age that serves as an obligatory condition for leaving the labour market. Institutionalisation of retirement at fixed chronological age boundaries, such as 60 or 65, has, in many industrialised countries, led to an increase of institutional ageism (Breda and Schoenmaekers 2006). Rigid chronological age boundaries support the social conviction that once past a certain age, the economic and social value of an individual suddenly drops, regardless of actual skills and qualifications. Shifting the responsibility for institutional ageism from the individual onto an institution or organisation may lead to its further institutionalisation which, if not contested, might further decrease control over possible consequences (Bytheway 1995). To introduce the flipside of the predominantly negative term, positive ageism is understood as those stereotypes, attitudes, and practices of individuals and institutions which influence the situation of older adults positively (Palmore 1999). Palmore (1999) recognized eight major positive stereotypes about older adults: kindness, wisdom, dependability, affluence, political power, freedom, eternal youth, and happiness. A number of favourable stereotypes specifically about older employees also exist (Loretto etal. 2007), which can work to their advantage in the labour market, including maturity, experience, responsibility, reliability, stability, loyalty, customer service skills, and patience (Loretto etal. 2000; Malinen and Johnston 2013; Posthuma and Campion 2009). However, studies also show that even when employers display positive attitudes towards older workers, these do not directly translate into positive practices (Loretto and White 2006). 6 Ageism andAge Discrimination intheLabour Market: AMacrostructural Perspective 94 6.2.1 Specific Features ofAge Discrimination intheLabour Market To better understand the dynamics of labour market age discrimination, we need to separate it from ageism in other areas of social life (health care, law, media, access to services, etc.). This distinction boils down to two primary features. First, ageism and age discrimination in the labour market use different chronological ages as benchmarks to define old age than other spheres of life. There is ample evidence of ageist practices being applied to workers and job seekers already in their 30s or 40s (Ghosheh 2008; Stypińska 2015). The contextual character of age that stems from its clearly socially constructed meanings (Aronsson 1997; Hazan 1994; Maier 2009; Nikander 2000) further contributes to the complexity and specificity of the phenomenon of labour force age discrimination. The definition of who is an older worker varies between branches of economy and types of entrepreneurship, as well as among various cultural and local organizational contexts. Certain types of occupations (e.g., programmers, customer service workers, online marketers) and economic branches (e.g., hospitality, new technologies, entertainment, social media, and tech start-ups) are permeated with ageist attitudes, and the “middle age” in these types of companies can be as early as 27 years old (Gaster et al. 2002; Stypińska 2015). To reflect the phenomenon of extreme ageism in modern high tech and start-up working environments, the term Silicon Valley ageism has been coined, which describes the dominant ageist attitudes of most enterprises in this sector (Wickre 2017). It is best manifested in the infamous words of Mark Zuckerberg, CEO and co-founder of Facebook, who stated that “young people are just smarter”. The second important distinction is that age discrimination in the labour market is the only area of social life where legal protection against unequal treatment is deeply institutionalised due to binding regulations, and thus provides a specific context for country-specific analyses. The protection of older workers inscribed in European Union law since the early 2000s, and in the USA since 1967, allows for efficient counteraction to inequalities due to age, be it at the individual or organizational level. 6.2.2 Intersectional (Multiple) Discrimination A further framework for enhancing the understanding of age discrimination in employment, and beyond, is the academic and legal perspective of intersectionality. Crenshaw (1991), who launched the concept within academic research, claimed that the experiences of individuals who hold several disadvantaged statuses are utterly unique, and thus any comparison to single-status disparity is not justified in legal or political terms. Intersectional (or multiple) discrimination is seen to operate between various socio-demographic categories, such as sex, race, age, ethnicity, class, and sexual orientation, and to be structurally carved into societal institutions, creating a J. Stypińska and P. Nikander 95 tangle of multiple oppressions (Baer etal. 2010). The intersectionality framework has also been widely adopted in gerontological research. So far, the most commonly studied aspect of intersectionality in ageing studies has been the combination of age and gender (Calasanti and King 2005; Krekula 2007; Ojala etal. 2016). The literature on the intersection of these two statuses goes back to the work of Simone de Beauvoir’s seminal book, The Coming of Age (1970). In this classic work, the common situation of older women was first described as a “double jeopardy” that combines both age and gender, whereas older men were seen to hold only one marginal status (de Beauvoir 1970). The categories of age and gender have also been coupled with minority statuses such as ethnic origin and race when analysing the experiences of older women with different types of discrimination in employment (Moore 2009; van den Heuvel and van Santvoort 2011). In such cases one can talk about “triple jeopardy”, where the person suffers from discrimination based on three grounds (Macnicol 2005). These intersecting statuses are also the source of difference in the experiences of various social groups within the labour market. The effects are visible in lower labour force participation rates, lower earnings, and, consequently, lower pension benefits among female populations across Europe. Ample evidence exists of the fact that older women experience barriers to reentering the labour market and that these experiences also vary substantially according to the women’s ethnic origin or race. In the area of self-employment, older minority women are similarly precluded from embarking on an entrepreneurial path, as they are constantly confronted with the normative white male ideal type for the entrepreneur (Ainsworth and Hardy 2008). Intersectional experiences of discrimination often prove challenging for empirical researchers and legal practitioners. Despite the wide theoretical agreement on the fact that intersectional discrimination occurs and that it has detrimental effects on the individual, a lack of agreement prevails as to how to measure this type of discrimination, and moreover, how to address it at the policy level. It is crucial to note, however, that minority statuses as grounds for discrimination and inequality in the labour market are not static functions which operate with the same force throughout the lives of individuals. Work force dynamics and the interplay of sociodemographic characteristics should therefore be analysed from a broader, life-course perspective. The differences between different age groups (cohort effect) as well as the differences between different stages of life (age effect) are certainly valuable and should be incorporated into the intersectional analysis of relatively more static statuses, such as gender, ethnicity, and migration background. 6.2.3 Ageism andDiscrimination Across theLife Course Loretto etal. (2000) observed a loosening of the tight association of the term ageism solely with older employees. Instead, ageism is increasingly being recognised as potentially affecting all age categories. Negative stereotypes and discrimination of 6 Ageism andAge Discrimination intheLabour Market: AMacrostructural Perspective 96 older people are matched by similar stereotypes and discrimination of children or young adults, which is called adultism. Studies of ageism in Europe revealed that across the European Social Survey (ESS) countries, respondents felt more positively towards people aged over 70 than people in their 20s (Abrams etal. 2011). A study of age-related prejudice in the UK showed that younger age groups (below 25years of age) were more likely to report age discrimination as more serious than older groups (over 64). Moreover, it showed that younger respondents are at least twice as likely to have experienced age prejudice than all other age groups (Swiery and Willitts 2012). Studies also confirm that these attitudes can have a negative effect on the employment opportunities of young adults (Abrams et al. 2011). Similar to challenges faced by older workers, younger employees often come across discriminatory practices, such as lower wages, disadvantaged working conditions, mistrust for their skills and competencies, as well as for their loyalty to the employer (Loretto etal. 2000; Sargeant 2010). What sets experiences of ageism in these age groups apart, however, is their potential outcome. Research shows that younger workers suffer less because of discriminatory practices and have greater opportunities to find alternative employment and to develop new career paths, simply due to the longer span of time available to work ahead of them. Older workers, on the other hand, resort to voluntary resignation much more frequently than younger workers. For older workers this entails a risk, as their options of finding a new job are more limited due to widespread age discrimination in recruitment practices (Sargeant 2010). The situation of younger workers has also significantly deteriorated in recent years, with the global economic crisis of 2008 bringing an unprecedented rise in unemployment rates among the youngest age cohorts (under the age of 25) (European Commission 2014). The most recent data show a 19.7% unemployment rate on average in the European Union, with the highest rates found in Greece (48%), Spain (46%), Croatia (44%), and Italy (38%), and the lowest in Germany (7%), Denmark (10%) and the Czech Republic (11%) (Eurostat 2016). Even though no direct link between the levels of unemployment and age discrimination can be established with certainty, there is evidence that in dire economic situations, younger people tend to be confined to more precarious and insecure jobs with lower levels of workers’ protection, including protection from discrimination (Blackham 2015). The harsh effects of the crisis have concentrated on one particular generation, namely those born in the 1980s (Hills etal. 2013). According to Hills etal. (2013), “Despite being better qualified than previous generations, people in their twenties were worst hit by the crisis in terms of unemployment, pay and incomes…The legal cases of age discrimination of younger workers suggest that the phenomenon is relatively widespread and goes underreported when compared with cases from older workers” (p.6). However, despite its significance, more in-depth study into the experiences of age discrimination in the labour market by younger persons is still largely lacking (Furunes and Mykletun 2010). J. Stypińska and P. Nikander 97 6.3 Macrostructural Processes andAge Discrimination intheLabour Market Three levels of analysis should be used to explain the origins of age discrimination in the workplace: the micro level, where psychological structures of deep-rooted prejudices, stereotypes, and biases are discussed; the meso level, where structures of the enterprise and of the management and interpersonal relations between employees can be studied, and the macro level, where the importance of macrostructural processes and factors on a global scale can be linked to the experiences of older workers with age discrimination. Since the literature on age discrimination pays less attention to the latter, this section digs deeper and discusses the role of macrostructural factors. These will be discussed in three subsections reflecting different macrostructural processes: social and cultural change (in the section on “Modernisation”); mechanisms of capitalist development (in the section on “Globalisation and Economic Crises”); and retirement regulations and antidiscrimination laws (in the section on “The Political Economy of Old Age”). 6.3.1 Modernisation Modernisation processes of the last two centuries in industrialised countries have impacted the status of older workers and dramatically changed the structure of the labour market (Hofaecker 2010; Kohli 1985; Palmore and Manton 1974). This change is based on the shift within the economy and society to higher levels of productivity, efficiency, and competitiveness—all core values inscribed in capitalism. Such emphasis has often worked to the disadvantage of older workers, who stereotypically have difficulties keeping up with the strength of younger workers, and with the increasing levels of technological advances and new forms of employment (Macnicol 2006; Palmore 1999). One of the key theories explaining the decreasing status of older people in societies and the labour market is the modernization theory of Cowgill and Holmes described in 1972in the book Aging and Modernization. The modernization theory shows that the reduced status of older people occurred because of the transformation from traditional, agrarian societies to modern, urbanised, and industrialised societies. Four major shifts occurred in the social structure throughout the modernising process: (1) improvement of health care resulting in the extension of the lifespan and hence institutionalisation of retirement schemes, but also more competition for jobs; (2) technological advances making older persons’ skills obsolete and leading to the emerging pattern of preference for younger workers; (3) urbanisation and the rapid movement of younger people out of traditional housing and family settings which led to the collapse of close ties in extended families and to the loss of status of “wise elders”; (4) the expansion of the public education system and the 6 Ageism andAge Discrimination intheLabour Market: AMacrostructural Perspective 98 disruption of traditional ways of intergenerational knowledge transfers (Cuddy and Fiske 2000). Although appealing, the modernisation theory has also faced criticism for employing imprecise definitions of social status, overgeneralising the processes of modernisation, and disregarding intervening variables such as ideology and value systems (Morgan and Kunkel 2007). In the process of testing the theory of modernization, Palmore and Manton (1974) concluded that indeed “employment status does decline steadily with the shift from agriculture, but that occupation and education status have a J-shaped1 relationship to modernization…It is suggested that as societies move beyond a transitional stage of rapid modernisation, discrepancies between the aged and non-aged decrease, and the relative status of the aged may rise” (p.205). 6.3.2 Globalisation andEconomic Crises Globalisation involved similar processes to those that occurred in modernization period. For this reason, the impact of globalisation on older workers needs careful consideration. Research suggests that globalisation processes have greatly deteriorated the situation of older workers. The loss of status of older workers in globalised economies is seen as a consequence of the demands of a global labour market in which cost-efficiency, flexibility, adaptability, and transferable skills are required (Baars etal. 2006; Hofaecker 2010). Hofaecker (2010) approached the worsening of the situation of older workers with an explanation of profound structural changes that the global economy imposed on labour markets. One such change is the deep restructuring of the traditional industrial sectors of the economy, where older workers were overrepresented. The aftermath of these processes meant increasing unemployment rates for older workers and difficulty in re-entering the labour force, which in turn prompted an intensification of age discrimination. Moreover, replacing older workers with younger ones has sometimes been seen by employers as a cost-saving technique (Roscigno etal. 2007). Age started to turn into a stigma also outside traditional industries, as the competitiveness of new working environments worked to the advantage of younger workers. Since 2008, the global labour market has been affected by financial crises, the age-specific effects of which are only recently becoming evident (Eurostat/European Commission 2012). The evidence from European social surveys carried out in the first year after the economic crisis of 2008 (European Commission 2009) showed a strong conviction that the economic crisis would negatively influence the position of older workers in job markets through the increase in age discrimination. Analysis from the point of view of employers and companies also revealed that in a situation of economic slowdown and deterioration of market opportunities, the burden shifted towards older employees by cutting their salaries (which are sometimes higher due 1 J-shaped relationship refers to a variety of J-shaped diagrams where a curve initially falls, then steeply rises above the starting point. J. Stypińska and P. Nikander 99 to seniority schemes) or by making them redundant (Cheung et al. 2010). The research evidence from recent years, however, shows that while younger people in many EU countries have faced severe difficulties in finding jobs since the crisis of 2008, employment rates of prime-age and older workers have remained remarkably stable (Eichhorst etal. 2013). 6.3.3 The Political Economy ofOld Age Despite the key role of modernisation and globalisation processes discussed above, the crucial role of state policies can shed light on the way older workers started to be perceived as unattractive and a burden rather than as capital to the economy and welfare systems. The political economy of old age describes the complex and dynamic relationship between the situation of older people and the social and political organisation of labour, retirement, and social assistance. The role of the state is central to the understanding of how the political economy of old age operates and thus the implications of certain state policies need to be analysed separately. According to Alan Walker (1981), the state regulated boundaries of productive economic activity (in the form of fixed retirement age) lead to high levels of dependency of older people in capitalist societies. The evidence for this process comes from theoretical deliberations on structured dependency - a term used to describe how the dependency of older people came to be artificially structured or deepened as an effect of various state policies (Townsend 2006). Among the most significant are policies dating back to the 1960s and 1970s, such as a fixed age for retirement; the minimal subsistence afforded on the state pension; substitution of retirement status for unemployment; near-compulsory admission to residential care of people whose abilities were fairly intact; the dependence of many residents in homes and of patients in hospitals and nursing homes; and the conversion of domiciliary services into commodity services (Townsend 2006). When it concerns age discrimination, however, the early retirement schemes introduced in many industrialised countries impacted the status of older workers the most (Breda and Schoenmaekers 2006; Neumark and Button 2014), and thus will be discussed below in more detail. Early retirement represents a long-term process, the first attempts of which can be traced back to the 1950s for some industrialised countries. In the economically prosperous period of the 1950s and early 1960s, most societies still practiced a full labour force participation of older workers. It was only in the 1970s that early retirement started to significantly increase in most Western societies (Hofaecker 2010). The reason for early retirement schemes was attributed to the expansion of welfare systems that provided financial security for old age and worked to pull older workers out of active labour participation. 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