A recent survey by the Federal Reserve showed that more people 55+ years are now working. This is a reversal of the trend of a few decades ago. It seems the Baby Boomers are not retiring as early. There are a couple of reasons:
- They can’t afford to retire. Between higher living expenses and salaries not increasing to keep up with inflation, there are fewer people able to save for retirement.
- In the U.S. size of the national debt may mean a disappearance of social security benefits sometime in the future. The large number of people eligible for payments is increasing as well. Government benefits might not be a reliable source of income.
- With such a large number of retiring workers and fewer younger workers to fill the jobs, it leaves job vacancies for the older workers to take. What company would not want experienced, already trained workers in every field?
Josh Zumbrun writing for The Wall Street Journal has pointed out that Americans are working longer but eventually they do get around to retirement. We haven’t returned to the Dark Ages when people worked till they collapsed and died.
The change in labor force participation that has happened at each age has been biggest for workers in their mid-60s. From age 62 to 65, women are about 10-12 percentage points more likely to work today than in 2000, and men about 6-8 percentage points more likely. These are precisely the years when decisions to continue to work help optimize the size of Social Security payments and the years where some workers may choose to continue working until becoming eligible for Medicare.
Americans’ retirements have been delayed, but not abandoned entirely. Having the financial means to retire is a big part of the story. But the vast majority are still getting to their golden years eventually.
It should be pointed out that the trend to work longer holds true for both men and women. What will the future hold for those reaching their 60’s? Will they retire at 65 as their relatives did? It’s doubtful as people are also living longer now. Retirement for 30 years is bound to be expensive and for some people, rather boring. I suspect there will be more people changing careers in mid-life, much as the retiring military do now. The community colleges already provide good training and refresher courses. We see an increase in online course packages as well. Leave a comment about what you think is ahead for retiring workers and what you plan to do.