As Americans age, that demographic shift is also affecting the workforce: A new Pew Research Center analysis found that 1 in 5 people over age 65 are still working, a jump twice as large as in the 1990s. 1980.
That translates to 11 million older people remaining in the labor force, which in pure numbers is four times the number from the mid-1980s, Pew said. And it's a trend that's expected to continue, as Americans 65 and older are projected to be one of the few demographic groups with increasing labor force participation over the next decade. according to the Bureau of Labor Statistics.
In addition to giving the economy a boost, older Americans who continue to work are also likely to help their own financial situation. That's because they can save more money and delay retirement, requiring people to dip into their savings, said Pew senior researcher Richard Fry. But this trend could also have a downside, as it could reflect the end of traditional pensions and the insufficiency of retirement savings for some workers.
“It's clearly not a good thing” that more seniors are working, Fry told CBS MoneyWatch. “Partly this is because they choose to continue working, but some of them may need to work even if they don't want to due to the precarious state of our retirement system.”
The bottom line, economically speaking, is that older people earn a larger share of wages and salaries paid by American employers, tripling from 2% in 1987 to 7% today, Pew said.
Older, but happier?
That said, those older workers tend to be more satisfied with their jobs than Americans under 65, Pew found. Work stress levels are also lower among older people who remain in the workforce.
Of course, it could be that older Americans who worked in jobs they disliked or found stressful chose to retire at age 65, leaving a subset of older workers who are generally happier in their workplaces and reluctant to retire, somewhat that Pew did. Don't analyze.
But there were some shared traits among workers over 65 that provide insight into their motivations. First, older workers are more than twice as likely as workers age 64 and younger to be self-employed, 23% versus 10%, which could indicate that they are small business owners, self-employed or similar.
They are also more educated than in past decades, Fry said. That agrees withThat has found that older Americans who continue to work are more likely to be professionals in fields such as education or management, or in the arts.
There are some other reasons why the share of older workers is increasing, Fry said. On the one hand, jobs have become more age friendly, providing seniors with work that is not as physically demanding as in previous decades. Additionally, older people are healthier today than in previous generations, he added. And finally, the retirement system is not what it was in the '80s, Fry said.
“Another thing that has changed is the way we manage pensions,” Fry said. “Over time, we've moved from the old pension system to where most Americans now don't have a traditional old-style pension (they have a 401(k) or 403(b)) and many old pensions required the employee to retire .at 62.”
He added: “There are no incentives to retire early, so the incentive” to leave the labor market has been removed.
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