Will You Work Until You Die, Grandpa?

In an earlier, harsher America it was not uncommon for people to work well into old age. In 1945, about half of Americans 65 and over were still in the labor force. And that was at a time when most work was physical in nature. 

Then came the great rise in postwar prosperity, with the spread of defined benefit pensions (often won by unions), the expansion of Social Security benefits, the creation of Medicare, and big leaps in housing wealth that provided nest eggs for retirement. 

By 1990, just 17.6 percent of men 65 and over were in the labor force. It was a golden age for the golden years. 

But labor force participation by seniors has been creeping steadily upward since 1990, with a fifteen percent increase in the share of older men who work. Among women, there has been a 50 percent increase. The biggest increases have been among seniors in their late 60s who find it easier to work.

So who's working longer, and why? 

For starters, white-collar workers are more likely to be in the labor force, which makes sense since it's to sit at a desk when you're old than drive a UPS truck. According to a 2008 Census study the labor force participation rate for older workers with advanced degrees (27%) was about three times as high as the rate for older workers with less than a high school education (8%).

Older workers are also more likely to be married than nonworkers. 

These facts might suggest that more seniors are working because the nature of work has changed, becoming less physical, and perhaps also more rewarding. Many people are working longer because they can and they want to. And that trend is likely to continue as the Boomers retire and eschew the old model of warehousing yourself in Florida for twenty twilight years.

But there is a darker story behind the numbers, too. Many seniors simply can't afford to stop working because of a confluence of economic trends: the shift away from defined benefit pensions to a failed 401(k) system that has left millions without adequate savings; the recent collapse in housing prices and epidemic of foreclosures; flat incomes for many workers over the past three decades that has made saving difficult; rising out-of-pocket healthcare costs; and the growth of usurious lending that has left many Americans, including older people, on a debt treadmill. 

One bitterly ironic dimension of this story is that there are many older Americans who need to work but can't. Low-income seniors have a far greater imperative to keep working, especially because of out-of-pocket helathcare costs, yet are often in occupations that are too physically demanding to enable them to keep working. Of course, also, discrimination against older workers is pervasive. 

In a prosperous, good society, older people generally shouldn't have to work to survive. America made steady progresss toward that ideal for decades. Now we are drifting away from it.