U.S. labor market participation rates have been running at 30-year lows, but for one group — 65 years old and over — participation in the labor force continues to ramp up. Link
Over the past twelve months there has been a steady increase in participants in the work force who are over 65 years of age. There are many explanations for this such as poor retirements planning and a poor economy over the last decade, but the fact is less people are retiring at early ages. These statistics are alarming as many conversations about the economic future and social security are at the front of the presidential debate. How do you think this trend will fare in the coming decade? Is this solely based on a poor economic situation or a lack of planning by many retirees?
Rather than worrying about the increasing numbers of elderly remaining in the workforce, perhaps we should take this in stride. Pensions were designed to take care of workers who had given their working bodies to their careers, and who were consumed by the time they reached age 65, today many retirement age individuals have reached an equilibrium with their jobs, and could probably keep working until a few months before their deaths. If the elderly still enjoy their jobs and are productive, we should be prepared to keep them working, perhaps on a part time schedule.
ReplyDeleteMy biggest concern with this article is the way that senior workers might end up crowding out younger individuals, but generally we don't worry too much about having a wealth of able, efficient human capital. Getting everyone back to work will largely be a matter of getting business owners back into a lucrative mood, and this will likely be mostly a matter of getting our public finances back in order. If we have to deal with the financial drag of paying off our parents' debts, it would be better to get started paying, and set a reasonable plan, than to keep playing hot potato with our country, just hoping that things will blow up while our political opponents are in office.
I think this is based on both the economic situation and the lack of planning by many retirees. The economic downturn in 2009 was a surprise for a lot of the people; unless they were heavily involved and/or interested in what was happening in the economy, people had no clue what was about to happen. I feel this created confidence in being able spend more and save less or not as much as they should, thinking that their jobs were secured. With the change in the economy, many people lost their jobs and therefore, decreasing their savings. Now, many have to continue working to support themselves and can't think of retiring. I do agree with Karl in that this affects the incoming youth into the work field. With more people searching for a job or currently working, the competition has intensified, even though most jobs would probably hire a younger person.
ReplyDeleteKarl and Abby both bring in good points. The economic downturn was not predicted and now the elderly are trying to make up for lost time in a way. I think this trend will continue if they drop pensions plans and other saving tools. That will make it harder for people to retire when they are "supposed to." I do think there was bad planning involved but not everyone had bad planning, I think a lot of it had to do with economics. Also, with people living longer and longer now a days, it is hard to judge how much money you will need to live the life you want after you retire. I'm sure a lot of people might have taken the approach work as long as you are able then retire and use up your savings then.
ReplyDeleteThe retirement age was set decades ago when people’s life expectancy was shorter. Now days, people who are 65 for the most part are in better shape and still have the energy to be working. Another huge reason, as the article mentioned, is that many people lost their 401K savings in the financial crisis.
ReplyDeleteRetirement planning can be a very interesting issue. When people stop working they really don't know how much money they will need to live the rest of their lives confortable. If someone lives to be 100, they need to save much more than someone who lives to be 80. The question of how much to save can be almost impossible to answer.
I agree with the points Bianca made. At the risk of sounding redundant I will not attempt to simply rephrase. Well done, beat me to the punch.
ReplyDelete