Amid the wreckage of the economic downturn, something curious happened to older Americans.
More of them are working.
The number of younger workers are declining, but workers age 55 and older are increasing.
Though the recession has thinned the ranks of other generations in the workforce, more people older than 55 are employed than ever before, according to the latest figures from the Bureau of Labor Statistics.
The reasons for the surge of older workers are complex, experts said, but one of the primary economic forces behind it is the growing fear among older Americans that they lack the means to support their retirement needs.
The phenomenon is closely linked to the broad shift in the United States that began in the ’80s away from reliance on company pensions toward the adoption of 401(k) plans and other personal savings.
That shift in retirement financing, combined with the recession, has dramatically increased the incentives to work into old age and appears to be reshaping how Americans ride out the latter part of their lives.
Like it or not, millions of graying Americans, some past 75 years old, are rejoining the workforce or staying in it longer than once might have been expected.
“Fear is a wonderful motivator,” said Alicia Munnell, director of the Center for Retirement Research at Boston College. “Some of these people are just clinging by their fingernails to jobs.”
In interviews, many older workers indicated that, indeed, the lack of a pension or fuller savings account was leading them to stay in the labor force longer.
A 60-year-old masonry contractor in Fairfax came out of retirement when his wife lost her job. A 70-year-old computer manager from Bethesda said he was still working because he was looking forward to a long life and he wanted to accumulate more savings to accommodate it. And a 63-year-old real estate saleswoman from Alexandria has put off retirement and, with the downturn in homes sales, sold off jewelry and purses on consignment.
“Sometimes I wish I could retire,” said Carole Oates, 63, the saleswoman. “But at this point I expect to be working as long as I can.”
An August survey by the AARP Public Policy Institute of people older than 50 showed that 57 percent reported that they were less confident than before the recession that they will have enough money to live comfortably throughout their retirement years. Similarly, 61 percent of the respondents said that their savings had fallen since the recession.
To the surprise of some experts, the incentives for older people to work have been strong enough to overwhelm the effects of the recession, which has slashed the ranks of the employed among other generations.
The number of people older than 55 who are working has actually risen by 3.1 million, or 12 percent, since the beginning of the recession, according to the latest figures from the Bureau of Labor Statistics. The phenomenon extends even to people 75 years and older; there are more of them working today than before the recession, too.
By contrast, the number of people between the ages of 25 and 54 who are working has shrunk by 6.5 million, for a drop of 6.5 percent.
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