Is the Continued Rise of Older Americans in the Workforce Necessary for Future Growth?

Workforce participation is growing for older workers in the United States, but focusing on prime-age employees to measure economic health to avoid demographic effects overlooks key trends among those older than 54, reports the Brookings Institution . Recent groups of women have been participating at higher levels than their predecessors early in life but at lower rates in middle age, while recent cohorts of men have been participating at lower rates throughout prime-age years. Yet both men and women in the 60 to 64 age range are still working at higher rates than their predecessors. Aging was determined to have contributed 2.7 percentage points to the 3.1 percentage point decline in workforce participation during the Great Recession, while changes in participation contributed only 0.4 percentage points. However, this conceals the fact that young people, particularly young men, have driven the general participation rate down between 2007 and 2018. The declining participation of prime-age or younger workers caused the overall participation rate to decline by 1.14 percentage points in total, while participation of men and women 55 and older increased the overall rate by 0.73 percentage points. For the trend of rising workforce participation among older workers to drive future growth, policymakers need to address labor force departures, and support workforce reentry for 55- to 64-year-old nonparticipants.