Academic journal article Generations

The Evolving Role of Public Policy in Promoting Work and Retirement

Academic journal article Generations

The Evolving Role of Public Policy in Promoting Work and Retirement

Article excerpt

Recent years have seen major shifts in attitudes about and opportunities for older adults in the American labor force. A century's pattern of many such workers being unable, unwilling, or reluctant to remain in the labor force in their later years has given way to new desires and abilities on their part to remain employed on at least some basis. Obviously, the two central parties in these shifting realities are the potential workers in question and those who would employ them. Yet, an important third player helping to shape and constrain the worker-employer relationship has been government. Historically, governmental policies have both influenced and been influenced by changes emanating from America's labor markets and families.


While labor relations-especially in a strong free-market culture such as the United States-are very much the province of workers and employers, the public sector plays a critical role in helping to establish ground rules for workplace-based relations. Formally, there are four mechanisms the public sector may use to affect employment. First, the federal government employs 1.8 million workers in its three branches and in independent agencies such as die Social Security Administration and NASA. On occasion, the federal government has also provided emergency short-term work to the unemployed, as during the Depression when the Civil Works Administration, for example, employed sixteen million people in 1933 and 1934 (Jansson, 2005).

Second, the government can provide training to unemployed and underemployed workers and subsidies to private business to encourage hiring of such workers. In the 1960s and 1970s, programs such as the Manpower Development Training Act and the Comprehensive Employment and Training Act represented modest efforts of this type. In the case of older workers, an example of such programs exists in the Senior Community Service Employment Program (SCSEP). First authorized under the Great Society's Economic Opportunity Act and today standing as Tide 5 of the Older Americans Act, die SCSEP currently assists some 47,000 low-income adults age 55 and over transition into die labor force dirougli employment widi locally based community service organizations.

The diird way in which government affects the employment relationship is through regulation. At the broadest level, it docs so through the monetary policy of the Federal Reseñe Board, die decisions of which have a profound impact on the employment rate and employment opportunities. However, diere are also in place a number of important regulator)' stauites that direcdy affect labor market practices in general and die place of older adults in the labor market in particular. Most prominent in die latter category are the Employee Retirement Income Security Act (ERISA) and the Age Discrimination in Employment Act (ADEA).

Income support in old age is a fourth and very powerful way that the federal government affects labor market participation among older workers. Prior to the 1930s, the federal government provided few protections to the nation's workers; however, reacting to the severe economic conditions of die Great Depression, the government instinited two critical income-maintenance programs, Old Age Assistance (oaa), a means-tested public assistance program, and Old Age and Survivors Insurance (oasi), the cornerstone of today's Social Security program. Over time, oaa faded in importance as the oasi program expanded and in the early 1970s became part of die newly created Supplemental Security Income program. Today, oasi serves as the principal income source for most Americans age 65 and above, contributing one-half of income for two-thirds of older Americans and 90 percent of income for no less than one-third of them. By pro\iding substantial amounts of income on a non-means-tested basis, oasi has encouraged and made it possible for many older people to stop working. …

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