Economic Downturn Has Led Seniors To Delay Retirement
The Wall Street Journal on Tuesday examined how falling real estate and stock markets have led many U.S. seniors to delay retirement. Economists and demographers recently have begun expecting a "huge exodus from the work force" as the first baby boomers reached age 60 in 2006. However, investment advisers and retirement planners at numerous financial firms are "seeing large numbers of older workers put off retirement as the housing and stock market troubles have deepened," the Journal reports. According to the Journal, the percentage of U.S. residents ages 55 to 64 in the work force rose from 63.3% in April 2007 to 64.8% in February 2008, an increase of more than one million workers. In addition, over the same time period, the share of those ages 65 and older rose now working to 16.2% from 16.0%, an increase of more than 212,000 workers.
The Journal reports a "big motivation for older workers" to remain in their jobs is "scarce health benefits for retirees." According to an annual survey by the Kaiser Family Foundation and the Health Research and Educational Trust, the share of large companies offering retiree health benefits decreased by half, to 33%, from 1988 to 2007. According to the Journal, there is a "potential upside" to seniors staying in the work force longer. People who work longer and earn more could ease the financial burden on entitlement programs, including Medicare. In addition, the trend also could be "good news" for "knowledge-based industries," including health care, which are expected to undergo a loss of experienced workers, according to William Frey, a demographer at the Brookings Institution (Levitz, Wall Street Journal, 4/1).
