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Baby boomers are staying in the labor force at rates not seen for half a century, according to statistics recently released by the Pew Research Center.1
Because of its size, the massive boomer generation has always had a substantial impact on social, cultural, and economic trends in the U.S. Many experts have heralded the aging and retirement of the boomer generation as a significant catalyst for economic slowdown and market uncertainty. In fact, over 10,000 boomers are turning age 65 every day. But, in part because boomers are continuing to work, only about half that daily number (5,900) are exiting the workforce.
In fact, the majority of Baby Boomers are still working, and the oldest boomers are continuing to work at the highest rate seen for generations. In 2018, 29% of Boomers ages 65 to 72 were in the workforce, marking a significantly higher labor force participation rate than the preceding Silent Generation (21%) or Greatest Generation (19%) when they were the same age.
Both boomer men and women are breaking records in continued workforce engagement. Boomer women, who overcame workforce barriers and revolutionized gender workforce roles, have throughout their lives exceeded the workforce engagement and accomplishments of prior generations. Today, a quarter of boomer women age 65 to 72 are working, a historically high labor force participation rate. But boomer men are also more engaged in the workforce than has been seen in decades. A third (34% ) of boomer men ages 65 to 72 are working – a rate not seen since the early 1970s.
The boomers still in the labor force tend to be more educated, according to the US Census. About four in ten (38%) of working boomers have at least a bachelor’s degree, versus a quarter (27%) of those not in the labor force.
There are many reasons people are continuing to work later in life. Financial security is certainly one of the most important motivations. Many people question if they can fund retirements that can last 20, 30, 40 years or more without work. But the top reason people say they work even beyond retirement age is “to stay healthy and active.” In fact studies show that working longer may help you stay more mentally and physically fit, live longer, and enjoy a happier, more fulfilling retirement experience.2
Top reasons to work in retirement
Source: Life Stage Insights, Client Priorities Survey, 2019
The continued productivy of the boomer generation can both help bolster the financial security of boomers and support continued economic growth. Working longer can increase savings, reduce the amount of non-working years to save for, and result in higher Social Security and other benefits. Moreover, since economic growth is in part fueled by labor force growth, the record-breaking labor force participation of boomers is good for the health of the economy and the markets.
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1. Pew Research, "Baby Boomers are staying in the labor force at rates not seen in generations for people their age", July 2019
2. Boston College, Center for Retirement Research, “How Does Delayed Retirement Affect Mortality and Health?”, 2018
This publication is designed to provide general information and is for discussion purposes only. The effectiveness of any strategy is dependent upon each individual’s facts and circumstances. This article does not provide legal, tax or account advice. Because of the possibility of human or mechanical error, the accuracy, adequacy, completeness or availability of any information is not guaranteed.