More Americans Are Returning to Work After Retiring During the Pandemic

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It wasn’t just disenchanted young workers who left jobs during the pandemic and the ensuing “Great Resignation.” Many older employees chose to retire for a host of reasons. But this year has seen a significant uptick in “unretirement” among newly retired workers, and Americans are back to retiring at a later age, according to Forbes.

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About 4.2 million people left the U.S. labor force between the fourth quarter of 2019 and the second quarter of 2021, according to a Federal Reserve Bank of Saint Louis analysis. That’s more than 2.4 million “excess” retirements.

But according to Nick Bunker, head of economic research at Indeed, retirees are also returning to the workforce in increased numbers. As of July, 3.2% of those who retired a year earlier are now employed, up slightly from the pre-pandemic average, Bunker told FOX Business.

Furthermore, leading analytic and opinion poll company Gallup has found that despite the blip caused by high retirement numbers in 2021, the average reported retirement age is back to pre-pandemic levels (61 years), as is the age in which non-retired people expect they will retire (66 years).

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Using data from its past 21 annual Economy and Personal Finance surveys and comparing retired and non-retired respondents by age, Gallup has traced a steady increase in the age at which people retired throughout the years.  

In all five-year age groups of people age 55 and up, the percentage of retired persons in each group dropped by 5% to 9% over time. For example, from 2002-2007, 41% of surveyed individuals ages 60-64 were retired. From 2016-2022, that percentage dropped to 32%.

The reasons for returning to work after retirement are multifold. Better Social Security benefits, concerns over a looming recession and lofty inflation and consumer prices have created a perfect storm that is enticing retirees back into the workforce.

Michael Liersch, head of wealth and investment management advice and planning at Wells Fargo, told Fox Business that adjusting to a sudden change in lifestyle without employer benefits in such unpredictable financial times can be enough to nudge a recent retiree back into the active work force. “Combine that with things like inflation being at multi-year highs and then markets being challenged. It can really cause people to start questioning whether they made the right choice to exit the workplace,” Liersch said. 

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Seniors coming out of retirement to consult or even start a new career are in the enviable position of calling the shots, thanks to a large glut of well-paid jobs available now as companies clamor to attract new employees in an economy where the unemployment rate is just 3.5%. Despite continued high inflation and interest rates, employers added 528,000 jobs in July. Analysts surveyed by Refinitiv had expected just 250,000 new positions, CNN reported.

Early retirement is doable for the financially sturdy, and unavoidable for many with concerning health problems or personal challenges that keep them out of the workforce. However, don’t expect the average retirement age or labor force participation rates to decrease anytime soon.

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Workers over the age of 65 will make up 9.5% of the labor force by 2030, according to a November 2021 report from the U.S. Bureau of Labor Statistics. Among the 75-years-and-older age group, the labor force is expected to grow by a whopping 96.5% over the same period.

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About the Author

David Nadelle is a freelance editor and writer based in Ottawa, Canada. After working in the energy industry for 18 years, he decided to change careers in 2016 and concentrate full-time on all aspects of writing. He recently completed a technical communication diploma and holds previous university degrees in journalism, sociology and criminology. David has covered a wide variety of financial and lifestyle topics for numerous publications and has experience copywriting for the retail industry.
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