Policymakers, the media, and the general public continue to focus attention on worker mobility and job security issues. These groups generally perceive that we have entered a new era of dramatically increased mobility and decreased employer/employee attachment that has negative implications for economic security. This Issue Brief analyzes the experience of workers displaced during the period 1993-1995.
Among all civilians ages 20 and older, 5.1 percent (or 9.4 million) experienced a job displacement during the period 1993-1995. Forty-seven percent (4.4 million) of displaced workers reported their displacement occurred in 1995. To put these figures in perspective, 118.5 million people ages 20 and older worked in 1995. Therefore, the number of displaced workers comprised 3.7 percent of the civilian work force in 1995.
A large and disproportionate share of those displaced were young. Forty-three percent were under age 35; workers this age accounted for 33.7 percent of all workers in 1993. In addition, 70.6 percent of the displaced had worked with their employer for less than five years (29.5 percent had worked with their employer for less than one year). These data are relevant in considering the implications of displacement for retirement income and health care security.
In addition, a disproportionate share of those displaced were accounted for by males, by those with less than a college education, by nonunion workers, and by workers in the mining/construction sector, manufacturing sector, and wholesale/retail trade sectors.
Over three-quarters of workers displaced during the period 1993-1995 have worked again. Among these, over one-third were unemployed 2 weeks or less; and close to one-half were unemployed 5 weeks or less; 18.5 percent were unemployed over 20 weeks; and 7.2 percent were unemployed over 40 weeks.
At the individual level, job displacement can entail real economic hardship. However, given the actual number of individuals impacted and the finding that a large share of those displaced were relatively young, in the aggregate the adverse consequences for health care and retirement income security would appear to be limited.
The majority of younger workers (under age 35) do not participate in a retirement plan at work and therefore are not losing retirement benefits if displaced. Furthermore, given tenure patterns among younger workers, it is not clear how many younger plan participants would have ultimately vested if they had not been displaced.
In terms of health care, 75 percent of displaced workers who had health insurance at their former job had private health insurance as of 1996, and 50 percent of those who did not have health insurance at their former job had private health insurance as of 1996.
