Even soaring inflation can’t lure many retirees back to work
Employers battling to fill job vacancies in the tight U.S. labor market this year have had a silver lining, as it were: decades-high inflation was bringing retired people back to the workforce.
But recent data suggest the trend may already be petering out.
The U.S. probably has reached a point where the older workers who hadn’t intended to retire permanently, or who had involuntarily been forced into retirement, have since rejoined the labor force, said Nick Bunker, economic research director for North America at recruitment firm Indeed Inc.
“We are getting closer to the bottom of that talent pool,” he said.
Before the pandemic, Americans generally ebbed and flowed in and out of retirement, with about 3% of retirees returning to employment each year for various reasons – from financial struggles to a great job opportunity or simply boredom.
Covid-19 disrupted that pattern, with many Baby Boomers retiring early or staying out of the labor pool out of concern about the virus in 2020 and 2021.
They contributed to the mass exodus of workers that was dubbed the Great Resignation.
However, by this spring, the number of retirees headed back to work climbed back again to about 3.3%, according to data from Indeed – possibly lured back by soaring consumer prices and plentiful jobs.
Last month, the percentage of workers who were retired a year earlier and who returned to the labor force stood at 3.2%, according to Indeed.
The rate has stopped accelerating and may decrease or stay flat in the near future, according to Bunker. Meanwhile, moves into retirement are edging up.
Overall, the number of available positions in the U.S. has decreased slightly from historical highs, according to data from the Labor Department.
But the number of vacancies remains historically elevated as demand for workers broadly outweighs supply.
Indeed data indicate that businesses won’t get much relief from retirees.
It’s unlikely employers strapped for help will see another new rush of older workers coming off the sidelines, Bunker said.