As many as two million baby boomers who were predicted to return to work in the years following the onset of the COVID-19 pandemic are choosing to remain in retirement, according to data from the Federal Reserve Bank of St. Louis and the U.S. Bureau of Labor Statistics (BLS). The findings were first reported by Bloomberg.
The United States has around two million more retirees than predicted in a development the outlet calls “one of the most striking and enduring changes to the nation’s labor force.” That’s despite recent increases in the expected retirement age.
According to modeling conducted by the Federal Reserve of St. Louis, the “great retirement” that took place alongside the pandemic has shown a divergence between actual retirees and those predicted in its pandemic-era model.
“While the gap seemed to be closing earlier in the year, it seems to have widened slightly since then,” Miguel Faria-e-Castro, economic policy adviser at the Federal Reserve Bank of St. Louis, told Bloomberg. “As of September, we estimate about 1.98 million excess retirees.”
Before the pandemic, the participation rate in the labor force for those of retirement age reached 20.8%. That level fell to 18.3% by July 2021, and has only risen to 19.3% in recent months, the data indicates.
According to non-seasonally adjusted data from the BLS, less than one in five workers at or over the age of 65 are actively seeking employment of some kind. States that even codified provisions into law to make rejoining the work force easier are seeing lower-than-expected takeup rates.
“In Michigan, a state law was tweaked to make it easier for teachers to ‘un-retire’ without risking their pensions,” Bloomberg reported. “Before this summer’s rise in excess retirees, there was speculation that a whole “un-retirement” wave was underway. But that seems to have not been the reality.”
Rejoining the workforce in later life is something that retirees are generally open to, particularly if seeking the return of a routine or — especially — a paycheck. But it can often be more challenging than some retirees may have predicted.
“Skills atrophy, work connections rapidly fade and job-seekers may confront ageism, all making it harder for many older workers to find a job,” the report explained. “In 2022, the mean duration to find a job for people age 65 and older was 31.6 weeks, 9 weeks longer [than] the overall average.”