The pandemic is pushing more Americans to retire

More older Americans are choosing to leave the workforce during the pandemic; For some unemployed workers, it was a decision they couldn’t avoid. About two million baby boomers have retired each year since the oldest turned 65 in 2011, but between the third quarter of 2019 and the third quarter of 2020, that number increased to 3.2 million, said Richard Fry, principal investigator. from the Pew Research Center. .

“There is evidence that, yes, as a result of the pandemic, the number of boomers retiring accelerated,” he said. Higher retirement rates could be personally and socially damaging. On a personal level, not all older and non-workforce people are ready for this lifestyle change. Some recent retirees may have been planning for this moment or had the financial means to leave earlier than planned. However, this is not the case for everyone. Many near-retirees were unprepared for retirement before the pandemic, but the crisis has only exacerbated situations due to job loss, reduced wages or illness. For the country, it is a loss of skilled and experienced workers, Fry said. It could also put pressure on financial markets, considering that these retirees (or long-term unemployed colleagues) will begin to reduce their retirement account balances over time. See: Was the pandemic a preview of your retirement? A lonely woman discovers the fragility of her social network If these older and long-term unemployed workers find work again, they may be taking what they can get, even if it pays less or does not require the same level of skills that they had. in his previous work, said Siavash Radpour, associate director for research at the New School for Social Research. “We fear that will be the case,” Radpour said. The alternative is to keep looking for work, but older workers out of work for two years will find it “very difficult to get back to work,” Radpour said. So there is retirement, whether you are prepared or not. Older boomers, who are between the ages of 65 and 74, were more likely to retire than younger members of their generation, Fry said. The number of younger boomers who retired in February and September 2020 held steady at around 18%, but for older boomers, the numbers were 64% in February and 66% in September, Fry said. Hispanic and Asian boomers were more likely to be affected than African Americans and whites during that time period. Those who had less education or were in the northeastern part of the country were also more likely to see higher retirement rates. There are a few reasons they may be exiting the workforce at a higher rate, Fry said. Some may be concerned about the health implications of the job and risks associated with contracting the coronavirus. But for others, it might have been the most attractive alternative to a daunting job search process. The pandemic was the first time in half a century that people 55 and older lost their jobs at a higher rate than their younger counterparts, with 17% of workers 55 and older more likely to lose their jobs. than their mid-career colleagues, according to the New School Retirement Equity Lab. See also: Age Discrimination Gets Real: Lessons from the Latest Recession Job loss can be a potentially devastating event for an older person, especially during a pandemic, as seen in numerous research reports. Aside from simply not being emotionally ready to leave the workforce permanently, the task of finding another job can take much longer than for younger employees. More than half (54%) of job seekers who were 55 or older were unemployed for at least six months in March, AARP found, compared with 41% who were between the ages of 16 and 54. The annual employment rate for people aged 55 and over also decreased, from 38.3% in March 2020 to 36.5% in March 2021. The unemployment rate for people aged 55 and over fell by 4, 5%, according to the Labor Office. Statistics, which could be in part the result of a “very successful month” with added jobs, said Jen Schramm, senior strategic policy advisor at AARP’s Public Policy Institute. “All those added jobs translate to fewer unemployed people,” he said. Another cause could be that some older workers are still deciding whether to re-enter the workforce, he said. “A key question is how many of the older workers who left the job market, especially in the first few months when millions of jobs were lost, how many will try to re-enter?” The decision to return could be that they need the money, found an attractive opportunity, or are vaccinated and don’t feel there is as much health risk from returning to work. Older workers are also more likely to experience age discrimination in the workplace, as well as during the hiring process. In a survey, AARP found that 78% of older workers saw or experienced age discrimination in 2020, compared to 61% in 2018. “The pandemic has increased age discrimination, but it has also made people more aware of it, ”Schramm said.