Far from retiring, rising numbers of older Americans are spending their golden years working, and liking it.
That’s the conclusion of two recent reports from Pew Research Center, on working Americans 65 and older, and on job satisfaction.
According to the latest report, released on Dec. 10, “Older workers were the most satisfied age group in terms of overall job satisfaction: 67% of older workers, 65 and older, were extremely or very satisfied with their job,’’ economist Richard Fry, a senior researcher at Pew, tells Rethinking65.
The share of workers who report being extremely or very satisfied with their jobs was significantly lower for those ages 50 to 64 (34%), 30 to 49 (31%) and 18 to 29 (38%).
“Workers 65 and up were most likely to express high levels because of the flexibility to choose when to work, and because of feedback they got from a manager or supervisor,” he adds.
The just-released report, “Most Americans Feel Good About Their Job Security But Not Their Pay,’’ also indicates that more than a third of the adult workforce (34%) is age 50 or older, compared with 24% in 2000.
When Fry and his co-workers conducted research last year, they found that roughly one in five Americans aged 65 and older (19%) are employed — nearly double the share from 35 years ago. Approximately 11 million Americans 65 and older work, noted the 2023 report, “Older Workers Are Growing in Number and Earning Higher Wages.”
Even more revealing, the 2023 report also noted that workers ages 75 and older are the fastest-growing age group in the workforce — more than quadrupling in size since 1964. Currently, 9% of adults age 75 and up are employed, about twice the share who were working in 1987 (4%).
Why Work?
Fry says he is often asked if older workers are laboring past conventional retirement because they want to or because they have to. So, when surveying Americans in October for the just-released report, his team followed up “to ask the older worker, ‘What’s the main reason you are working? Is it mainly because you need money or mainly because you want to work?’‘’ he says.
The results: 17% of respondents age 65 and up said they need the money, 27% said they want to work, and 56% said they need the money and they want to work.
“I was surprised that four out of five [older] workers said they are working because they want to; it’s voluntary, it’s not being forced on them because of financial straits,’’ Fry says.
The 65-and-up respondents have a different perspective on their employment. Half said they view their job as “just something to get them by,” rather than as a career or a stepping stone to a career. This response was provided by a smaller share of workers ages 50 to 64 (34%), 30 to 49 (31%) and 18 to 29 (38%).
Among other findings, workers age 65 and older with middle- and upper-family incomes are more likely than those with lower incomes to express high levels of job satisfaction (53% and 54% vs. 42%).
A Sea Change
Fry attributes the increase in older workers to better health and more education. Current life expectancy for females is 80.2, for males 74.8; in 1987, it was 78.3 for women and 71.4 for men.
“Older Americans are making a greater contribution to the workplace in the United States economy — not just because there are more of them, not just because boomers are big in numbers — but because there is a change in behavior,” says Fry.
“Older Americans are choosing to work, choosing to work full time, and getting paid more than they used to. Not on a par with their younger counterparts, but they are a rising force not only in our economy but in our workplaces,’’ he says.
Time and Money
The average older worker earns 80% of the average annual earnings of younger workers ($58,600 vs. $73,700), according to the 2023 Pew report. This earnings gap has narrowed in part because more older workers are working more hours. Approximately 62% of workers ages 65 and older now work full time, compared with 47% in 1987 and 56% in 1964, the researchers noted.
The stepped-up hours of older workers is one indicator of how important they are in the U.S. labor force, Fry says.
The typical worker aged 65 or older earned around $22 per hour in 2022, compared with $13 an hour in 1987. Fry noted that these figures are adjusted for inflation. Workers ages 75 and over have experienced similar wage growth since 1987 as those ages 65 and up but they are paid slightly less (a median hourly wage of $20).
More Statistics of Note
Fry also pointed to some other notable statistics in the 2023 report. For example, older workers account for 7% of all wages and salaries paid by U.S. employers in 2023 — more than triple their share in 1987 (2%).
Continuing a longtime trend, older workers are also more than twice as likely as younger workers to be self-employed (23%, vs. 10% of workers ages 25 to 64).
In addition, 44% of today’s older workers have a bachelor’s or higher degree, compared with 18% in 1987. “That puts them about on par with workers ages 25 to 64,’’ the report noted.
Older Women in the Workforce
The research also looked closely at women. They now account for 46% of the 65-and-older workforce, up from 40% in 1987 and 33% in 1964. That’s pretty comparable with the percentage of today’s workers ages 25 to 64 who are women (47%).
Fry attributes older women’s greater participation in the workforce to their increase in education and longer spans of employment.
“Older women today have much longer stints of being employed, they’re more attached to the labor market, they have the experience and they want to stay in,’’ he says.
Today, 42% of older working women have a four-year college degree, compared with 12% in 1987. And they’ve nearly caught up with the percentage of older working men with a four-year degree (45%). But within the 25-to-64 workforce, 49% of women have a four-year college degree, compared to 41% of men, notes the 2023 report.
Fry cited work by 2023 Nobelist, Harvard University professor Claudia Goldin, on American women in the labor force.
“The short story is that women used to think of work as just a job, something they would do when they didn’t have other important duties,” he says. “Then, over the decades in the 20th century, they started thinking about their careers, and also started planning when they wanted to have children. So, women’s work lives went from sporadic to much more continuous.’’
Looking Ahead
Other factors encouraging older Americans to keep working include Social Security increasing the age to receive full retirement benefits from 65 to 67; an increase in “age friendly’’ jobs that do not require physical exertion; and access to employer-provided benefits, such as retirement plans and pensions.
According to U.S. Bureau of Labor Statistics’ projections included in the 2023 Pew report, the rising force of the older worker will continue over at least the next decade.
By 2032, adults ages 65 and older are projected to comprise 8.6% of the labor force (those working and looking for work), up from 6.6% in 2022. And older adults are projected to account for 57% of labor force growth over this period.
“The BLS projects that by 2032, 21% of older adults will be in the labor force, up from 19% in 2023,” notes the 2023 Pew report. “The only other age group projected to increase its labor force participation rate is the 55- to 64-year-old group.’’
Eleanor Sullivan is a writer for Rethinking65. n a four-decade career in journalism, she has reviewed many books on best practices for financial advisors.
