For more than two decades, older Americans have opted to stay in the labor force longer, while younger Americans have reduced their labor force participation. Women are likely to continue working in their 60s. Since the start of the recession in December 2007, the share of older working women has grown while the percentage of every other category of U.S. worker – by gender and age – has declined or remained flat. In 1992, one in 12 American women worked past age 65. Now, around one in seven do. The U.S. Department of Labor projects that number grow to almost one in five by 2024.
Idaho also has seen large increases in labor force participation for senior workers — 62 percent for men and 129 percent for women — while other workers’ participation declined or remained flat.
In 1992, one in 18 Idaho women worked past age 65. Now, around one in seven do — the same ratio as the nation.
With baby boomers in their 50s and 60s swelling the ranks of older workers and their labor force participation on the rise, Idaho workers 55 and over grew by 161 percent, from 64,300 in December 1995 to 167,500 in December 2015, according to the Current Population Survey, the monthly survey conducted by the Census Bureau to track unemployment in the U.S. Over the same period, Idaho’s labor force 25 to 54 years of age doubled from 145,200 to 296,100.
According to the Employee Benefits Research Institute, in 1991 just 11 percent of workers expected to retire after age 65. That jumped to 33 percent in 2014. Another 10 percent don’t plan to retire at all.
There are many reasons why older workers are postponing retirement.
- Automation and the relative decline in manufacturing jobs has made work less physically demanding and put less strain on older bodies, making it possible for more older workers to remain in the workforce.
- People with more education work longer. Workforce participation rates of workers ages 65 and older with a college degree are roughly double those with less than a high school diploma. Today’s older workers have significantly higher levels of education than those in earlier generations.
- Today’s older workers are healthier than their counterparts in the past.
- Boomers are approaching old age with more debt and less savings, while fewer will receive pensions than workers of previous generations. They know they are likely to live longer than their parents’ generations and fear they will outlive their savings.
- Anxiety about health care costs also keeps many people working. Some are postponing retirement until they’re until eligible for Medicare because of the decline in employer-provided retiree health insurance and the rapidly rising costs of health care.
- The shift in incentives in Social Security, including the increase in the delayed retirement credit and the relaxation of the earnings test, also have encouraged workers to stay in the labor force longer.
The slowdown in retirements is making it a little easier for employers to adjust to the flood of retirements that began when the first baby boomers entered their 60s in 2006. So the slower pace of retirement has boosted the potential labor supply slightly.
Kathryn.Tacke@labor.idaho.gov, regional economist
(208) 799-5000 ext. 3984