The aging of the baby boomer generation has led to a growing share of older individuals in the U.S. labor force. According to a recent study by the Employee Benefit Research Institute (EBRI), people aged 65 and older made up the largest proportion of the population over age 16 as of last year. This trend began in 2008 as baby boomers started reaching retirement age.
On the other hand, Americans between the ages of 16 and 24 represent the smallest share of the population, while those aged 45 to 54 make up the second smallest group. This demographic shift has significant implications for the labor force. The EBRI brief, which examined data from the U.S. Census Bureau’s Current Population Survey through December 2023, noted that the aging baby boomers have increased the share of older workers in the labor force.
However, as this generation is now mostly in their 60s and the following generation, Gen X, is much smaller, a decrease in the proportion of workers aged 55 or older is expected to follow.
Aging boomers reshape workforce demographics
The report also highlighted the personal benefits of working longer, such as accumulating more assets, reducing the need to deplete existing assets, and delaying Social Security claims.
While the overall labor force participation rate remained relatively stable between 1975 and 2023, there were notable changes in participation rates by gender. Female participation rates increased initially but have been declining since the 1990s, while male participation rates have fallen. Despite these shifts, both genders had lower participation rates in 2023 compared to 2008.
Craig Copeland, director of wealth benefits research at the EBRI, emphasized the significance of these demographic changes. “Even though the difference in labor force participation rates between 1975 and 2023 is less than 2 percentage points, notable demographic and participation shifts have occurred over the past several decades,” Copeland said. The extent to which this demographic shift continues will depend on whether baby boomers maintain higher labor force participation rates than in the past.
As the prime working age population shrinks, businesses are increasingly relying on Americans aged 65 and older to fill the gap in the workforce.
- FoxBusiness.”Silver ceiling: Career expert warns delayed retirement trend could have ‘ripple effect’ on younger generations”.
- BenefitsPro.”Labor force gap grows as baby boomers age”.
- Yahoo.”More Seniors Working to Fill Youth Participation Gap, Reveals EBRI Study”.