Delayed Retirement, Unretirement, and the Impacts of an Aging Workforce

Making up just over 20% of the US population, Baby Boomers—i.e. Individuals born between the year 1946 and 1964—have almost all reached retirement age. The oldest members of this generation, in fact, reached the minimum distribution age five years ago.

But just because retirement is an option for the majority of baby boomers, that doesn’t mean they are necessarily ready to take that next step. It’s estimated that while 80% of baby boomers are 65 or older, only 40% of that generation has retired. Interestingly, of those who retired in recent years, there are also some that made the decision to go back to work.

In a trend called ‘unretirement’, both national and global workforces are seeing a shift in how workers are choosing to spend their golden years. Why are these people going back to work you might ask?

There are a few possible explanations.

Some individuals may feel they retired too soon and with inflation plus the rising cost of living, they have chosen to return to work to better support themselves financially. Others may have retired during the COVID-19 pandemic to avoid risks to their health, but now regret that decision as work-from-home options have become more wide-spread.

Regardless of why someone over the age of 65 might choose to go back to work, the wave of unretirement doesn’t seem to be slowing down. So how does having the elderly in the workforce impact the labor market? And how can businesses capitalize on this highly experienced generation while also addressing their age-related workplace needs?

Let’s take a closer look.

The Positives of an Aging Workforce

According to a recent study, roughly 20% of retirees are working either part time or full time, and 7% reported they were currently looking for employment. When asked why they chose to return to work, 48% of respondents said they felt they needed to work for financial reasons while 45% stated they chose to work for “social and emotional benefits”.

For many, returning to work, either in the same field they were in before or a completely new one, comes with much needed social interaction and mental stimulation. Additionally, with the increased popularity of flexible work schedules and remote options, many retirees are able to continue making money while also engaging in the retirement activities they enjoy.

But how does having older people in the workforce affect businesses and the economy more broadly?

Well, in many ways, unretirement can be very beneficial. First and foremost, with the vast majority of American youth planning to go to college instead of entering the workforce after high school, the US may be facing major labor shortages in the coming years.

Additionally, older workers bring years—if not decades—of experience with them, as well as potential new networking opportunities and perhaps even an impressive list of contacts. There is also research which shows “worker motivations evolve with age,” and that “attributes like interesting work and autonomy [rise] to the top around age 60.”

In other words, there’s a good chance older applicants will be applying for a job because they actually want to be a part of that team. They are engaged in their work right out of the gate— unlike many younger workers, who are trying to pad their resume or network themselves into a position they are more excited about.

Potential Issues of An Aging Workforce

While there are many benefits that come along with this unretirement trend, there are also some potential hurdles to consider when bringing the elderly back into the workforce.

Employers have to make their workplaces as accessible as possible by offering flexible schedules, work-from-home options, or shifting older workers into less physically demanding roles. Additionally, there may be skill gaps—primarily in regard to new technology—which will require additional training.

For the individuals thinking about going back to work, unretirement also isn’t going to be the easiest process. Reports estimate that 96% of people currentlyin the workforce are searching for new jobs. This means the job market is already highly competitive, and those considering jumping back into the fray may find themselves navigating a completely new world of job hunting. With ATS systems rejecting their outdated resumes, to struggles figuring out how to set up a video interview, this process can be intimidating for the older generations.

That said, with the help of recruitment experts like the ones at CyberCoders, the prospect of returning to work doesn’t have to be so stressful. Our true match technology ensures that qualified candidates—regardless of age—are given a fair shake, placed quickly, and paid what they are worth.