(Image Source: Nick Jones / Unsplash)
January 2024
Americans over age 65 are wealthier, healthier, and more educated than those in previous generations. This good fortune has coincided with societal changes that promote working longer. The age at which one can access social security has moved from 65 to 67. Most retirement plans replaced defined benefit pensions, which incentivize retirement at a certain age, with defined contribution plans, such as 401k or 403b plans, which incentivize longer participation in the workforce.
As a result of these changes, today’s Americans aged 65 or older are working at higher rates than those seen in recent generations. According to a recent study by Pew Research Center, 19% of adults aged 65 or older participate in the workforce today, as compared to 11% in 1987. Sixty-two percent of those aged 65 or older who are in the workforce are employed full time, as compared to 47% of older workers in 1987. After adjusting for inflation, older workers are earning more in 2022 than they have in previous generations, making a median of $22 per hour in 2022 as compared to $13 per hour in 1987. The average annual earnings for workers aged 65 reached $58,600 as compared to $27,600 in 1987 and $5,200 in 1964, after adjusting for inflation. Overall, older workers accounted for 7% of total U.S. wages and benefits in 2022, up from only 2% in 1987.
That brings us to today’s question: Those aged 65 and older made up 6.6% of the overall workforce in 2022. Do you think the trend will be toward greater or lesser participation for this age group over the next decade? What proportion of the workforce is predicted to be aged 65 and older in 2032?
A. 19.1%
B. 15.4%
C. 8.6%
D. 5.4%
E. 2.1%
ANSWERS
Answer: C. The trend toward working longer is expected to continue, with workers age 65 or older expected to make up 8.6% of the total workforce by 2032.
