People Over 75 Are The Fastest-Growing Demographic In The Workforce — And The Number Is Expected To Continue Increasing

The American workforce is experiencing a significant demographic shift, with a notable increase in the number of older workers. A recent Pew Research Center report reveals that 19% of Americans age 65 and older were employed in 2023, a figure nearly double that of 1987. This trend is not just a reflection of the growing older population but also a changing workforce landscape.

The older workforce, numbering roughly 11 million today, has nearly quadrupled since the mid-1980s. The increase is driven partly by the aging of the baby boom generation and other factors that contribute to the rising employment rate among older adults. Among these factors, workers age 75 and older are the fastest-growing age group in the workforce, more than quadrupling in size since 1964. Today, 9% of adults age 75 and older are employed, about twice the share working in 1987.

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Older Americans today tend to have higher education levels than in the past, with 44% of older workers holding a bachelor’s degree or more, compared to just 18% in 1987. They are also healthier and less likely to have a disability than in previous generations, allowing them to extend their working lives. 

Retirement plans have evolved, with employers shifting toward defined contribution plans like 401(k)s, which do not encourage early retirement. Additionally, policy changes, such as the increase in the age for receiving full Social Security benefits, have likely encouraged older adults to delay retirement.

The nature of jobs has also changed, becoming more age-friendly. Many occupations now entail less strenuous physical activity and allow for greater independence and flexible work schedules. 

The older workforce has seen significant earnings growth. In 2022, the typical worker age 65 or older earned $22 per hour, up from $13 in 1987. This group accounted for 7% of all wages and salaries paid by U.S. employers last year, a substantial increase from 2% in 1987.

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Women make up a larger share of the older workforce than in the past, representing 46% of all workers age 65 and older today, up from 40% in 1987. The gender gap among older workers has been steadily shrinking, and nearly half of older workers are now employed full time, compared to 47% in 1987. Older workers also are more likely to be satisfied with their jobs, find them enjoyable and fulfilling and are less likely to find them stressful.

U.S. Bureau of Labor Statistics projections show that the role of older workers will continue to grow over the next decade. Adults age 65 and older are projected to be 8.6% of the labor force in 2032, up from 6.6% in 2022, accounting for 57% of labor force growth over this period. The labor force participation rate of older adults is expected to increase to 21% in 2032, from 19% in 2022.

For those who prefer not to work in their 70s or wish to retire early, there are several strategies to consider:

Early and efficient retirement planning: Begin planning for retirement as early as possible. This includes saving consistently, taking advantage of retirement accounts like 401(k)s and individual retirement accounts (IRAs) and ensuring that investments are aligned with retirement goals.

Maximize Social Security benefits: Delaying the start of Social Security benefits can increase the monthly benefit amount. While benefits can be claimed as early as age 62, waiting until full retirement age or later can result in a higher monthly payout.

Healthcare planning: Healthcare costs can be a significant part of retirement expenses. Consider options like Medicare and supplemental insurance, and plan for potential long-term care needs.

Debt reduction and expense management: Reducing debt before retirement and managing expenses can help stretch retirement savings further. This might include paying off mortgages, credit card debts and other loans.

Passive income streams: Explore ways to generate passive income, such as rental properties, dividends from investments or annuities. These sources can provide a steady income without the need to work.

Downsizing or relocating: Consider downsizing to a smaller home or moving to a location with a lower cost of living. This can reduce monthly expenses and free up equity from a larger home.

Lifestyle adjustments: Adjusting lifestyle expectations to live more modestly in retirement can also help reduce the need to work at an older age. This includes budgeting for travel, entertainment and other discretionary expenses.

Seek professional financial advice: Consulting with a financial adviser can provide insights and strategies tailored to individual circumstances, helping to optimize retirement savings and income.

Continual learning and skill development: Even if full-time work isn’t desirable, keeping skills up to date can provide opportunities for part-time work, consulting or freelancing in a chosen field, offering flexibility and supplemental income.

Community engagement and volunteering: For those seeking fulfillment and social interaction without the commitment of a job, volunteering or participating in community activities can be rewarding alternatives.

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*Jeannine Mancini has written about personal finance and investment for the past 13 years in a variety of publications, including Zacks, The Nest and eHow. She is not a licensed financial adviser and the content herein is for information purposes only and is not, and does not constitute or intend to constitute, investment advice or any investment service. While Mancini believes that the information contained herein is reliable and derived from reliable sources, there is no representation, warranty or undertaking, stated or implied, as to the accuracy or completeness of the information.