A vast majority of America’s elderly are pushing back their retirement age, even further as they fear they simply do not have the financial means to retire. The workforce labor participation rate of individuals 65 and over has reached an all time high of 20 percent. This brings rise to the question why now and what has changed for the 65 and over population? It is no secret that unemployment is also at an all time low, with the largest rise in employment going to those 65 or older with at least a bachelors degree.
According to Teresa Ghilarducci, an economics professor at the New School for Social Research, the average worker requires about 80 percent of their pre-retirement income in order to retire comfortably. Social Security only covers about 40-50 percent of that pre-retirement income therefore, the average worker earning about $40,000 a year, simply can’t afford retirement. Similarly so, even those averaging in the middle to top income class are also grossly under-saved. The math is simple, the longer you live, the longer you will need your retirement savings to suffice and the average life expectancy has gone up! Perhaps, this is why we are seeing more and more individuals aged 65 and over continuing on in the workforce today.
Undoubtedly, there are many factors which we must now evaluate in order to accommodate the rise of this aging workforce. Questions such as, how can we protect these individuals from age discrimination and even injury in the work place? Another factor to note is, many of these individuals come with years of work experience which may translate as “too expensive” to hire for employers, when up against their younger and less experienced counterparts. With the rise in this working demographic, it will be interesting to see what changes we can expect too see in the workforce environment.
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