Source: HR Daily Advisor
Author: Lin Grensing-Pophal, Contributing Editor
While the initial blame for the Great Resignation was placed on younger workers who were happy to sit at home with a government stimulus check instead of a job, data suggests that the driving force behind the current labor shortage may be more closely related to older workers’ choosing to retire early.
Baby Boomers Finally Exiting the Workplace
Buoyed by a strong stock market boosting the value of their 401(k)s and unenthusiastic about the prospect of going back to work in general and in the midst of COVID precautions in particular, millions of older workers have opted to simply call it quits.
The Great Resignation is starting to butt heads with another, slightly earlier phenomenon, however. In recent years, many retirees have lingered in the labor market. As the physical demands placed on the average worker have been greatly reduced as the nation transitioned from a manufacturing economy to an information economy and life spans have increased, those in their mid- to late 60s find they crave stimulation and a sense of purpose in retirement. This has led many to pursue part-time jobs, consulting roles, or even full-time jobs.
Not Your Grandmother’s (or Mother’s) Retirement…
“The concept of retirement as we know it is changing, and has been for a long time,” writes Sophia Epstein in an article for BBC Worklife. “The number of people working past retirement age has grown consistently since the 1990s. In the US, 32% of people aged 65 to 69 were in work in 2017, far more than the 22% who were working in 1994. In the UK, employment rates for people older than 65 doubled between 1993 and 2018.”
Moreover, the conditions that contributed to mass early retirement just a few months ago have changed considerably. Historic inflation has made the cost of living a greater concern for those on fixed incomes, and a depressed stock market means securities-backed savings may have lost considerable value.
“In the US, job site Indeed reports ‘unretirement’ levels are at 3.3%, much higher than the sub-3% average seen since 2017,” continues Epstein. “In the UK, Indeed saw a spike in 55-to-64 year-olds ‘urgently seeking work,’ while another survey found that two-thirds of people who retired during the pandemic expect to keep working in some form.”
The recent shift in older workers’ retirement plans should be a boon to employers in the aggregate. The key for recruiters will be not to overlook this experienced workforce segment and to be conscious of their motivations for staying in or returning to the workforce.
Lin Grensing-Pophal is a Contributing Editor at HR Daily Advisor.
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