EBRI Notes

Sep 18, 2017 15  pages


This study examines employee-tenure data of American workers. It uses U.S. Census Bureau data from the Current Population Survey (CPS), including the most recent January CPS data, to examine the tenure with current employers of wage and salary workers from 1983–2016.

While some have expressed the view that current American workers change jobs more frequently and have less employment security than was the case for past generations, the data on employee tenure—the amount of time an individual has been with his or her current employer—show that career jobs never actually existed for most workers and continue not to exist for most workers.

Here are the key findings:

  • The median tenure with their current employers for all wage and salary workers ages 25 or older was 5.1 years in 2016, compared with 5.5 years in 2014 (highest year), 4.7 years in 1998-2002 (lowest years), and 5.0 years in 1983.
  • The median tenure for male wage and salary workers ages 25 or older was 5.2 years in 2016 (down from 5.5 years in 2014), compared with 4.9 years in 1998-2002 (lowest years) and 5.9 years in 1983 (highest year). The median tenure for female wage and salary workers ages 25 and older was 5.0 years in 2016, which was down from 5.4 years in 2014 (highest year) but up from 4.2 years in 1983 (lowest year).
  • Male workers ages 55-64 experienced the largest change in their median tenure from 1983–2016 from a level of 15.3 years, which would not be considered a full career, in 1983 to 9.5 years in 2006, 10.7 years in 2014, and 10.2 years in 2016. The highest median tenure level for females was 10.2 years for those ages 55-64 in 2014, which decreased to 10.0 years in 2016 but was above the 9.8 years in 1983.
  • The median tenure of public-sector workers has been significantly longer than the median tenure of private-sector workers from 1983 to 2016. The public sector median tenure has ranged from two-thirds longer to just over two times longer. In 2016, the median tenure for public-sector workers was 8.5 years compared to 4.1 years for private-sector workers.
  • The distribution of tenure had been moving to longer tenures from 1983-2012, when 52.7 percent of wage and salary workers ages 20 or older had been with their current employers for 5 or more years. In the most recent years, shorter tenures have increased where in 2016 50.6 percent of these workers have tenure less than five years.
  • The percentages of wage and salary workers ages 45-64 with 25 or more years of tenure in 2016 were below their peak values in 1983. However, for workers ages 60-64, after declining from 1983 (23.3 percent) to 2006 (16.6 percent), the percentage with 25 or more years of tenure, despite a dip in 2010, increased through 2014 (21.6 percent) before a drop off in 2016 (19.8 percent). The percentage of those ages 55-59 with 25 or more years of tenure decreased from 1983 (22.7 percent) to 2012 (17.1 percent) before increasing through 2016 (18.9 percent). The percentage of workers ages 45-54 with 25 or more years fell from 12.9 percent in 1983 to 8.8 percent in 2016.
  • The data on employee tenure looking at both the median tenure levels and the percentage of workers above various tenure lengths indicated that career jobs didn’t exist for most workers in the early 1980s and have continued not to exist for most workers.
  • These tenure results indicate that, historically, most workers have changed jobs during their working careers, and all evidence suggests that they will continue to do so in the future. This persistence of job changing over working careers has several important implications—potentially reduced or no defined benefit plan payments due to vesting schedules, lump sum distributions that can occur at job change, and public policy issues both through lower retirement incomes of the elderly population because of benefits lost at job change and the experience of the public-sector labor force, which has workers with higher levels of longer tenure who are likely to be retiring soon.
  • From 2014 to 2016, the median tenure decreased for private-sector workers and the share of workers with shorter tenure levels increased, suggesting that both new workers have been added to the private sector labor force and workers already there have changed jobs, potentially to better jobs, as the economy has improved.
  • As the unemployment rate started decreasing in 2012 and continued through 2016, the percentage of workers with shorter tenures increased. While workers who have been at their jobs 10 or more years seem to be staying in them, with the decrease in the unemployment rate more workers are starting new jobs or changing jobs, particularly those who previously had 5-9 years of tenure.