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Small business thrives on hiring older workers.

Small business and older workers have a mutual attraction, according to a 1991 Small Business Administration study. In 1988, companies with fewer than 25 employees hired more than two-thirds of newly hired workers aged 65 and over. In that year workers who were at least 65 and over represented 4.4% of all new hires in companies with up to 25 employees but only 1.4% of all new hires in companies with 100 or more employees.

There are several reasons for the attraction between older workers and small businesses.

* Many older workers prefer part-time employment, and small companies tend to offer more such opportunities than larger corporations. In 1988, over two-thirds of workers 65 and over were working part-time.

* Older workers are usually paid less than younger workers, making them well-suited to small businesses that need to hold down costs. In 1988, the average worker earned $9.51 per hour. However, workers who were 65 to 69 earned, on average, $8.27 per hour, with new hires in that age group earrang only $5.22 per hour.

* Health insurance coverage does not appear to be much of a factor in choosing a job. In 1988, 83% of the 65-69-year-old workers were covered by health insurance from a previous job and 82% were covered by Medicare or another public insurance plan. Since small companies tend to offer modest benefits packages, they are attracted to older workers.

Both small and large companies rate older workers superior to younger workers by many different measures. More than 65% of employers polled in a sample drawn from an SBA database said workers aged 55 and over were more reliable, punctual and loyal than the average worker, while less than 5% said they were less reliable, punctual and loyal than average. More than 94% of the employers said older workers required the same or less training, were at least as productive, had the same or greater overall skill levels and had the same or greater mental concentration as the average worker.

SBA Administrator Patricia Saiki said, "This study shows older Americans are superior employees and are especially important to small companies. They should not be denied the opportunity to compete in the labor market." TABULAR DATA OMITTED
COPYRIGHT 1992 American Institute of CPA's
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
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Publication:Journal of Accountancy
Article Type:Brief Article
Date:Aug 1, 1992
Previous Article:Small business relies on CPAs, says PCPS survey.
Next Article:Small business gains confidence.

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