BOX 4.1 Impact of Age Discrimination on Tightness in the IT Labor Market

The following calculation is a “back-of-the-envelope” calculation that provides approximate magnitudes; it is not meant to be mistaken for a rigorous analysis.

  1. The Category 1 IT workforce of about 2.5 million is about 1.8 percent of the U.S. workforce (140 million).

  2. The overall U.S. workforce is about 50 percent of the national population of about 275 million.

  3. According to the U.S. Census, the number of individuals in the 15-year age bracket from ages 50 to 65 is about 40 million. Approximately 1/15 of this number, or about 2.7 million, enter this age bracket every year.

  4. Thus, the number of IT professionals aged 50 to 65 is about 1.8% × 50% × 40 million = 357,000. (Note that this is an overestimate of this category, because IT is a field in which workers are relatively young.)

  5. One published source indicates an unemployment rate of about 17 percent for programmers over the age of 50.1 Thus, the number of unemployed IT professionals is 17% × 357,000 = 60,700. (Note that this number is much higher than the committee has been able to confirm.)

  6. The 1994 AARP study referred to in the main body of the text indicated that about 25 percent of older applicants for information systems jobs were unfavorably treated because of their age. If all of the 60,700 unemployed programmers over 50 are capable of doing the work entailed by new jobs, the number of older programmers who are unfavorably treated because of their age and who can do the work required by new jobs is 25% × 60,700 = 15,200.

This number would increase yearly by 1/15 × 15,200, or 1,010 per year.

Conclusions

Even under the assumptions above that overstate the case for age discrimination, addressing all age discrimination issues in IT would not have any significant impact on tightness in the IT workforce in the long term. The fundamental reason is that the number of jobs expected to be added to the Category 1 IT workforce yearly is much larger than any plausible estimate of the number of age discrimination incidents against older IT workers. However, given the number of vacancies in the IT workforce today, elimination of all currently existing age discrimination in the IT workforce could have a small but important one-time effect on tightness in the workforce.

1  

Didio, Laura. 1998. “Over the Hill?” Computerworld, January 12.



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