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Occupational tenure, employer tenure, and occupational mobility.

Occupational Tenure, Employer Tenure, and Occupational Mobility

Most people change occupations several times during their lives. However, these changes usually take place when workers are young. Relatively few workers voluntarily change careers in midlife. While in school or soon after completing their education, individuals may have several different jobs, but then they usually settle into an occupation and stick to it until retirement. They advance in their careers by getting pay raises and promotions to supervisory and managerial positions. Generally, men remain in an occupation longer than women; college graduates, longer than persons with less education; full-time workers, longer than part timers; self-employed workers, longer than wage and salary workers; and older workers, longer than younger workers.

This picture of occupational tenure was developed from an analysis of data obtained from the January 1987 Current Population Survey (CPS). People were asked about the kind of work they were doing in that month, how long they had been doing it, and how long they had been employed continuously by the same employer. Data on three different but related subjects were collected: Occupational tenure, employer tenure, and occupational mobility. Occupational tenure is the length of time a person has spent in an occupation. It will be discussed in terms of the average tenure for different groups of workers and for different occupations. Employer tenure is the length of time a worker has been with the same employer. Occupational mobility is more or less a mirror image of occupational tenure; it measures the number of workers who change from one occupation to another. Data on mobility can be analyzed to yield information on entry and exit rates for occupations and to show some characteristics of displaced workers. An entry rate is the percentage of persons employed in an occupation who had voluntarily entered it from another occupation; conversely, an exit rate is the percentage of persons employed in an occupation who had voluntarily left for a new occupation. Displaced workers are those who changed their occupation because of a plant closing or moving, slack work, or the abolishment of their positions or shifts.

Occupational Tenure

The median occupational tenure was 6.6 years. As chart 1 shows, tenure increased directly with age, rising from an average of 1.9 years for workers ages 16-24 years to 20.6 years for those 65 and over. Almost half of the workers approaching retirement (those who were ages 55-59) had been in their current occupation at least 20 years. Some older people had been doing the same kind of work virtually all their adult lives. Almost one-fifth of the workers ages 65 to 69, for example, reported 40 years of tenure or more.

Occupational tenure averaged 7.9 years for men and 5.4 years for women. Although the difference in tenure by sex was not significant for young people, it increased steadily with age. Among workers ages 60 to 64, the average was 23.9 years for men compared to only 14.5 years for women. Men had more tenure mainly because their labor force participation had been more continuous. Many older women currently in the labor force had interrupted their careers for home and family responsibilities, and some later resumed work in a different field. At all but the youngest ages, women were more likely than men to have entered their jobs recently.

Among the major occupational groups in the economy, average tenure ranged from 10.4 years for farming, forestry, and fishing workers to 4.1 years for service workers. (See chart 2.) These averages reflect differences in the characteristics of the occupations within each group. The average tenure in an occupation depends on such factors as its recent growth or decline and its attractiveness. If employment in an occupation has declined, the lack of jobs for new entrants combined with the aging of experienced workers will tend to raise average tenure. But an occupation will also have lengthy tenure if it has sufficient appeal in terms of such characteristics as earnings, advancement opportunities, job security, and lifestyle. This occurs for two reasons. Without these attributes, an occupation is not sufficiently attractive for most young entrants to stay long enough to accumulate much experience. In addition, occupations with strong worker attachment have fewer job openings caused by replacement needs and, thus, fewer young entrants.

Table 1 shows the relationship between tenure and age in the 20 occupations with the greatest average tenure and the 20 with the least. About one-half of the occupations with the greatest average tenure have had employment declines or little change in employment in the last several years. Farming is an example of an occupation that is attractive to young people but has declined because opportunities for new owner/operators have been limited by the growing expense of land and equipment and the consequent merging of small farms into larger, more economically viable enterprises. As a result, only about 4 percent of farmers were under 25 years of age, compared to 19 percent of the workers in all other jobs. Lack of employment growth also contributed to high average tenure in several other occupations, including barber, clergy member, railroad conductor, and telephone line installer and repairer.

The strength of a person's attachment to a job depends largely on his or her earnings, which in turn depend on education. The greater the investment in education, the more likely that a person will remain in an occupation, because a change may result in the loss of earnings or require additional education. Therefore, tenure tends to be lengthy in the professional specialty, executive and managerial, and technician occupational groups, which require lengthy education. The relationship between tenure and higher education was stronger for older workers than for younger ones. Tenure increased directly with the years of education completed. At ages 60 to 64, for example, average tenure was 20.7 years for those with 1 to 3 years of college, 22.2 years for those with 4 years of college, and 25.2 years for workers with 5 or more years of college.

Fields of work that can be entered only after years of apprenticeship or many years of on-the-job training also tend to hold workers. This is the case for the precision production, craft, and repair group, which includes workers in high-paying trades such as plumber and electrician. Some occupations that can be entered without specialized education and training also have fairly long tenure, including police and firefighter; the job attachment of these workers is influenced by liberal retirement benefits.

Self-employment was prevalent in many occupations having the greatest tenure including dentist, farmer, and barber. The self-employed have greater flexibility in reducing their work schedules to suit their needs and, thus, are more likely than others to continue working beyond the customary retirement age. More than 8 percent of the self-employed were age 65 and over, compared to only 2 percent of the wage and salary workers. Working beyond age 65, however, also contributed to the high average tenure in some jobs having relatively few self-employed people, such as clergy and farm manager.

A large proportion of the workers with the least tenure were in food service and retail sales occupations. Many others were childcare workers, stock handlers and baggers, garage and service station workers, and file clerks. These low-paying fields require little, if any, previous training or work experience and are usually entered by people who want an immediate source of income rather than a long-term career. In addition, a high proportion of workers in these fields hold part-time jobs and many are in school. Not surprisingly, part-time workers have much lower tenure (3.1 years) than full-time workers (7.2 years).

Employer Tenure

Data on occupation tenure and employer tenure differ because the former is measured in cumulative years and the latter is measured in continuous, that is uninterrupted, years. The average employer tenure for all workers in January 1987--4.2 median years--was less than the average occupational tenure--6.6 years. The gap between employer and occupational tenure is small when workers are young but grows steadily with age. Workers age 65 and older averaged 20.6 years in their occupation and 12.4 years with their employer.

A change in occupation usually means a change in employer, except in the case of advancement to supervisory and managerial positions. Almost 9 out of 10 workers who had less than 2 years of time in their occupation also had less than 2 years of continuous time with their employer. As expected, the probability of a worker changing employers tended to diminish as an individual's occupational tenure increased. Among workers who had 25 years or more in their occupation, almost one-half had 25 or more years with their employer and another one-fourth had 10 to 24 years. A disproportionate number of these workers were in occupations that have high concentrations of self-employed workers, such as farmer and physician, or that have few employers, such as postal service mail carrier and firefighter. Only one-fifth of the individuals with 25 or more years in their occupation had been with their employer 5 years or less. Many of them were accountants, engineers, registered nurses, automobile mechanics, carpenters, and heavy-truck drivers.

Occupational Mobility

Occupational mobility was measured by asking individuals who were employed both in January 1986 and in January 1987 if they were doing the same kind of work in each of these months. Almost 10 million of the 100.1 million persons employed both months had changed occupations during this period, an overall mobility rate of 9.9 percent. This rate has been fairly stable over the last 20 years. The majority (53 percent) of those who changed occupations had done so voluntarily, citing better pay, advancement opportunities, or working conditions as their reason for switching, which implies that they were upgrading their careers. Only 13 percent were in different occupations because they had lost their previous jobs. The remainder gave other reasons for switching occupations, including moving to a different residence, and changing from part-time to full-time work or vice versa.

Like occupational tenure, occupational mobility is strongly related to the age of workers, but in opposite ways. As workers grow older, their tenure increases while their mobility decreases. (See chart 1.) The pattern holds among all groups regardless of demographic or educational characteristics.

Almost 1.9 million of the 14.6 million workers 16 to 24 years of age had changed occupations voluntarily during 1986. The voluntary occupational mobility rate for these workers (12.7 percent) was more than double the average for all workers. The high incidence of job switching among young workers is a result of several factors. Many have not yet completed their formal education and are working before or after school, or during summer vacation. Occasionally these become permanent jobs, but usually they are only temporary sources of income until schooling is finished. Even after young people have completed their education, they may change occupations frequently, because they are trying to find what best suits them. Also, compared to older workers, younger workers usually have less invested in their occupations and their companies and often have less attachment to their geographic residence and even their lifestyle. Generally, they are at the lower end of the earnings scale, have less to lose in switching occupations, and have more time to reap higher rewards later in their new field. Older workers with many years of seniority typically face high costs when changing an occupation or an employer because they may jeopardize accumulated benefits and pension rights, and, at least initially, experience a loss of earnings. They also have a relatively short time span in which to realize a return on any additional investment in training necessary for a new occupation.

In addition to enabling an analysis of the age and experience of workers changing occupations, the CPS data make possible the analysis of occupational entry and exit rates between January 1986 and January 1987. Chart 3 shows that voluntary entry and exit rates for workers age 25 and older were similar in many broad occupational groups. This suggests that many workers who are leaving their jobs for better pay, advancement opportunities, or working conditions are being replaced by others who left their old jobs for the same reasons. There are differences, however, in some occupational groups. Executive and managerial occupations have the highest entry rate, yet one of the lower exit rates, which makes sense because management is a career goal for many individuals. In contrast, the entry rate in farming, forestry, and fishing occupations was only one-fourth the size of the exit rate, reflecting the diminishing employment opportunities in these declining fields. Entry rates also were lower than exit rates in sales and service occupations, many of which do not pay well but can be entered without specialized education and training or even previous work experience, and therefore attract workers from outside the labor force.

Most movement occurs between occupations that are similar in terms of educational requirements and the nature of the work. About one-third of the voluntary job shifting in 1986 occurred within broad occupational groups, and much of the remainder was between closely related groups. These kinds of changes were most prevalent in executive and managerial, professional specialty, and administrative support occupations. About two-fifths of the workers who left a professional specialty occupation, for example, did so to take a job in a different professional specialty, and another one-fifth left for a managerial job.

Displaced Workers

Relatively few workers age 25 and over who changed their occupation had been displaced, that is, had left their previous jobs as a result of a plant closing or moving, slack work, or the abolishment of their positions or shifts. Just 11 percent of the job changers were in this group: Although these workers are relatively few in number, their ability to readjust is of special interest because many of them had lost jobs in occupations that are found mainly in industries with stagnating or declining employment, thus making it difficult for them to find similar work. A secretary, for example, can easily switch industries while staying in the same occupation; a metal-lathe operator cannot.

When workers change occupations because of displacement, they often move to a new industry. About two-thirds of the displaced workers age 25 and over who changed occupations found their new job in a different major industry group. There was an overall shift of these workers from the goods-producing to service-producing industries. About one-half of the net outflow of displaced workers from the goods-producing sector occurred in manufacturing (which employs about 80 percent of all goods-producing workers), and the remainder came almost equally from mining and construction. Service-producing industries with the largest net inflows of displaced workers were retail trade; finance, insurance, and real estate; and transportation and public utilities.

About three-fourths of the displaced workers age 25 and older who changed occupations took a job in a new occupational group. Displaced workers age 25 and older left the following occupational groups in greater numbers than they entered them: Executive, administrative, and managerial; technicians and related support; precision production, craft, and repair; and operators, fabricators, and laborers. Net inflows were largest in service and sales occupations. Many of those who lost jobs also appear to have suffered an occupational downgrading. Two-thirds of the displaced workers with new occupations stated that their new jobs had lower earnings, while only about 16 percent said their new jobs paid more.

Trends

Average years of occupational tenure rose from 5.7 in 1983 to 6.6 in 1987 as the work forced aged. The increase, however, was more than just a reflection of an older population. Men and women at almost every age had been working in their occupation longer.

Further increases in tenure may occur. Young women starting work today, unlike their mothers 20 or 30 years ago, are more likely to remain in the labor force for a large part of their adult lives, continuing to work even when they have infants and toddlers at home. Another factor that may eventually increase tenure among both sexes is the changing occupational structure of employment. Occupations that require the most education--and thus, have the strongest worker attachment--are projected to increase as a proportion of total employment. [Charts 1 to 3 omitted] [Tabular data omitted]
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Author:Carey, Max
Publication:Occupational Outlook Quarterly
Date:Jun 22, 1990
Words:2725
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