Adults age 65 and older are twice as likely to be working today compared with 1985, and many of them are making good money, according to a new report. But the likelihood of their being able to work past the traditional retirement age is shaped by how much education they have and what type of work they do.
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As of February 2019, more than 20 percent of adults over age 65 are either working or looking for work, compared with 10 percent in 1985, says the report from United Income, a financial planning and investment management company targeted to those ages 50 to 70. The study analyzed data from the Current Population Survey, a report compiled monthly by the U.S. Census Bureau and the Bureau of Labor Statistics (BLS). The BLS expects the trend of older people working to continue, estimating that 13 million Americans age 65 and older will be in the labor force by 2024.
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But there are notable differences between the older workers who continue their careers past 65 and those who do not. For example, the share of these adults who are working who have at least a college degree grew from 25 percent in 1985 to 53 percent in 2019. The average income of these retirement-age workers jumped by 63 percent after adjusting for inflation, from $48,000 to $78,000.
“The healthier, better-educated and higher-earning, white-collar people can work longer,” says Elizabeth Kelly, senior vice president of operations at United Income. “There is a mismatch. Those who are working longer need the money less.” Blue-collar jobs tend to be more physically demanding, making it more difficult for older adults to stay in these positions.
Overall, older Americans in the workforce tend to earn more than their younger counterparts. The $78,000 average earnings for workers 65 and older compares with $55,000 on average for those under 65.
The last time 20 percent of those 65 and older were working was in 1962, the report says. In 1949, one of the first years the Current Population Survey included this measure of the workforce, 28.5 percent of those 65 and older were working.
The data on older adults in the workforce reflects a significant shift in retirement trends. The surge in individuals aged 65 and older actively participating in the labor force has been substantiated by various reputable sources, including the United Income report discussed in the article. This report delves into the analysis of data drawn from the Current Population Survey, a widely recognized and regularly compiled report by the U.S. Census Bureau and the Bureau of Labor Statistics (BLS).
The United Income report highlights a noteworthy increase in the percentage of individuals aged 65 and above engaged in work or actively seeking employment, rising from 10 percent in 1985 to more than 20 percent as of February 2019. This rise is projected to continue, with the BLS estimating that by 2024, approximately 13 million Americans in this age group will be part of the labor force.
An essential factor influencing the ability to work past traditional retirement ages pertains to education levels and occupational choices. The report emphasizes the correlation between higher education and prolonged career engagement, indicating that older individuals with at least a college degree are more likely to continue working. Furthermore, it's noted that the average income of retirement-age workers has significantly increased, even after adjusting for inflation, highlighting a 63 percent jump from $48,000 to $78,000.
Elizabeth Kelly, the senior vice president of operations at United Income, underscores the impact of health, education, and income on the ability of individuals to work longer. White-collar professions typically held by more educated and higher-earning individuals tend to facilitate longer careers due to lesser physical demands compared to blue-collar jobs. This contrast in job types is crucial as physical demands can make it more challenging for older adults to sustain these positions.
Interestingly, the disparity between older and younger workers' average earnings is notable. On average, individuals aged 65 and above in the workforce tend to earn more, with an average income of $78,000, compared to an average of $55,000 for those under 65.
The historical context provided in the article, referencing statistics from 1962 and 1949, offers additional insight into the evolving patterns of older individuals in the workforce, illustrating a marked increase from past decades.
These trends collectively demonstrate a shift in retirement patterns, influenced by factors such as education, occupation type, income, and health, which significantly impact the likelihood of individuals continuing to work past the traditional retirement age.
