A new study released on Thursday by the Pew Research Center reveals that a rising number of Americans over the age of 65, the normal age for retirement, are heading back to work to earn higher wages.
According to Axios, the number of older Americans returning to the workforce has been consistently rising since the late 1980s, with one major decline during the Chinese Coronavirus pandemic. Some of the reasons for this increasing return to work include changes in Social Security law forcing older Americans to keep working even past 65 in order to receive their full benefits; additionally, there has been a shift away from pension plans that normally would force most Americans to retire by a certain age, in favor of 401(k) plans that allow for ongoing workforce participation.
Many workers over the age of 65 are earning higher wages overall. In 2022, the average 65+ worker was making an hourly wage of about $22, compared to $13 in 1987 (adjusted for inflation). The average hourly wage for those between the ages of 25 and 64 is about $19.
The advent of Social Security was noticeably the beginning of the trend of older people retiring sooner. In the 1880s, prior to the implementation of such welfare programs for retirees, roughly 75% of older men were employed. This also correlated to a shorter life expectancy in those periods of time.
The number of Americans over the age of 65 is expected to grow even larger within the next decade. By 2032, all members of the Baby Boom generation will be over 65, as per projections by the Bureau of Labor Statistics (BLS). This particular demographic is also far more likely to have a four-year college degree, which makes them more employable than those without such a degree. At the same time, advances in technology have reduced the physical demands of many jobs, thus making work easier for older people with limited mobility and other health-related concerns.
“If people are working longer because they find purpose in their jobs and want to stay engaged, that’s good for them individually,” said Nick Bunker, the head of economic research at Indeed Hiring Lab. “Older folks have lots of experience and knowledge to pass down.”