Booming Job Market Can't Fill the Retirement Shortfall

Few older Americans are getting the opportunity to fortify their savings or pay down debt to ease their way into retirement in their last few years of employment, reports the Wall Street Journal . Government data indicates that although the official unemployment rate is 3 percent for older workers, close to 8 million older Americans are unemployed or stuck in low-quality jobs that offer little opportunity to prepare for retirement. Stony Brook University estimates that workers 56 and older earn on average 27 percent less in their new job after they have been unemployed for at least a month, versus an average raise of 7 percent for people younger than 30. According to Stony Brook's David Wiczer, people who go through unemployment "and come out better on the other side are almost exclusively under 35." Being unemployed for only a few months or living on a depressed salary without benefits can hurt a senior's finances as he or she struggles to cover mortgage payments, healthcare, and other regular expenses. Reasons underlying little hiring for older workers range from age discrimination to a lack of skills to their unfamiliarity with new recruiting channels. The Bureau of Labor Statistics calculates that 31 percent of job seekers 55 and older have been looking for work for 27 weeks or longer, compared with just 24 percent of younger job seekers. Older seekers report looking for work, on average, for 34.6 weeks, almost three months longer than the average of 23.4 weeks among jobless 25- to 54-year-olds. Meanwhile, the Boston College Center for Retirement Research says 17 percent of workers 55 to 64 had a pension plan in 2016, down from 33 percent in 1992.