Rising Rate of Retiree Recidivism

The number of retirees returning to the workforce is increasing, says a recent report that cites inflation and labor market changes as reasons why higher numbers of adults age 65 and older are returning to the workforce. 

Many people retired in 2020, as they commonly do during difficult times, says MagnifyMoney, but now some of them are returning to the workforce. 

The percentages of Americans age 65 and over who retired and were working rose by approximately the same percentage points from late April and early May 2020 to late April and early May 2022: 

 

 

 

Group	Late April/Early May 2020	Late April/Early May 2022	Change, 2020-2022
% of Americans Age 65 or Older Who Retired	14.9%	17.4%	+2.5 percentage points
% of Americans Age 65 or Older Who Were Working	19.5%	21.9%	+2.4 percentage points

There is great variation among the states regarding reentry and retirement, says MagnifyMoney in its analysis of Census Bureau data:

Top Five States with an Increase in Older Adults in the Workforce, 2020-2022

Rank	State	% of Working Older Adults, 2020	% of Working Older Adults, 2022	Percentage Point Change, 2020-2022
1	New Jersey	18.1	37.0	+18.9
2	West Virginia	8.0	25.2	+17.2
3	Pennsylvania	14.0	28.6	+14.6
4	New Hampshire	16.5	25.3	+8.8
5	Georgia	18.9	27.0	+8.1

Top Five States with an Increase in Retirees, 2020-2022

 

Rank	State	% of Retired Adults, 2020	% of Retired Adults, 2022	Percentage Point Change, 2020-2022
1	Mississippi	13.1	20.0	+6.9
2	North Dakota	11.1	18.2	+7.1
3	Lousiana	12.2	19.2	+7.0
4	Illinois	12.2	18.6	+6.4
5	Alabama	14.5	20.1	+5.6

MagnifyMoney is not alone—in their 2022 U.S. Retirement Survey, the investment management firm Schroders found that 69% of working Americans plan to work in retirement. 

Why? 

Older Americans are returning to the workforce for a variety of reasons, says MagnifyMoney: 

• job openings have increased and are beyond where they were before the pandemic;
• salaries are increasing; 
• vaccination rates may have lessened the fears of Americans who are more elderly—and therefore, more vulnerable—about being around others in the workplace; 
• inflation creates economic pressure that consistent income can help address; and
• stock market downturns have engendered concern among older adults about their savings. 

And Schroders identified three main reasons why working Americans expect to work during retirement: 

• 56% said they would in order to cover basic living expenses;
• 51% said they want to stay busy; and 
• 49% said they want to remain active and healthy. 

Good Timing? 

Older Americans returning to the workforce may not be a bad thing, suggests Schroders. They found that 54% of those age 60-67 said they have saved less than $250,000 for retirement; in addition, 57% of retirees said they saved less than $250,000 when they retired. Furthermore, 44% of retirees said that their expenses are higher than they anticipated.