?The COVID-19-related decline in workforce participation among older people is reversing.
The pandemic saw an increase in older workers leaving the workforce in the U.S., turning around a long-term trend toward rising labor force participation among older workers. But some are now returning to work amid a cost-of-living crisis in a phenomenon that has been referred to as the “Great Unretirement.”
The number of people ages 65 and older working or seeking work has increased by 144 percent in the past 20 years, according to the U.S. Department of Labor (DOL). The broader labor force grew by about 13 percent in that time. The trend had been building momentum when it ran up against the wall of the pandemic and retirements soared, but the participation numbers for this cohort are nearly back to pre-pandemic levels. The DOL projects labor force participation among older workers to keep growing over the next decade, and a recent survey showed that 68 percent of people who retired during the pandemic would consider returning to work.
SHRM Online discussed the trend with Laurel McDowell, the lead for the Job Connections for Mature Workers Program at global recruiting and staffing firm ManpowerGroup.
SHRM Online: How are mature workers being defined in the program?
McDowell: Mature workers today are classified as [ages] 50 and older by many government agencies and advocacy groups. We are interested in experienced workers and job seekers who encounter, or expect to encounter, difficulty in getting or keeping a job primarily because of age.
Many mature workers have considered delaying retirement or extending their careers. People are living longer, and they wish to continue to make a meaningful contribution through their work. This, coupled with the uncertainty of the economy, inflation and the erosion of their retirement savings makes for a situation where many feel compelled to return to work or work longer at their current job than they had originally planned.
SHRM Online: Who are these return-to-work job seekers?
McDowell: We are seeing three main categories. First are those who lost their positions or were downsized, mostly during the pandemic, and for varied reasons either cannot go back to the same job or have chosen not to and want to move on to a different type of role or new employer. Second are those who have held positions with much responsibility that, by nature, have required them to dedicate long hours to be successful, and would now like to reduce their level of accountability and hours of investment at work. Finally, the third group is the “unretiree,” or those returning to work after retirement. As the labor shortage drags on, more opportunities have become available for those looking to re-engage with work, and in this new work world there are now more options for them, especially with the surge in remote work. Approximately 2.4 million people retired during the first 18 months of the pandemic. Some of those were early retirees. Many now appear to be heading back to work.
SHRM Online: What are the driving factors behind unretiring?
McDowell: One of the most significant reasons we see retirees seeking to return to the workforce is that they miss the fulfillment of having a sense of purpose. They take pleasure in being strong contributors, and they also feel the loss of the social interaction and sense of belonging that their workplace and workmates provided to them. Also, the rising costs of health insurance and living expenses in general plus the erosion of retirement savings precipitated many to seek employment again out of financial necessity.
Many retired because of naturally attaining retirement age eligibility; however, workforce reductions during the pandemic forced others to consider retiring early. For some, it gave them time to pause and re-evaluate their work/life balance and decide that they no longer wished to continue investing a great deal of their life’s time at work, given the option to retire early. For others, there were health and safety concerns around being out in public and exposing themselves to risk factors.
SHRM Online: What benefits do mature or unretired workers bring to an organization?
McDowell: Research shows that seasoned employees are more likely to show up to work on time and less likely to call in sick. Mature workers also do not tend to switch jobs as often as their younger colleagues. Tenured employees shine when it comes to maturity and professionalism—resulting in a strong work ethic. Nurturing conscious inclusion on the part of companies allows for diversity and a multi-generational workforce, creating opportunities for mentorship. Mature workers are frequently motivated by community, mission, and less by money, so often companies get workers skilled beyond a position’s requirements for less cost. Finally, the resurgence of tenured talent entering the job search scene can help ease the talent crunch from which many companies are suffering. Today’s most forward-looking organizations view recruiting diversity as key to their ongoing success.
SHRM Online: What can employers do to counter age bias during the job search?
McDowell: Hiring managers are three times as likely to rate job applicants [ages] 35 to 44 as “application ready,” more “experienced” and a better “fit” than those over 45. They rate the over 45 job seekers lower on average on all three measures—even experience—than those ages 18 to 34.
Employers need to take intentional actions to combat ageism in the hiring process, including:
- Getting buy-in from senior leadership.
- Being aware of the signs of ageism.
- Putting preventive measures into place.
- Holding generational diversity training with supervisors and employees.
- Reframing job descriptions so they do not include subliminal bias language such as “energetic,” “new grads” or “able to fit in with our lively culture.” If you use artificial intelligence for resume screening, make sure there are not parameters in place that filter mature workers out due to tenure or other potential age-related criteria.
SHRM Online: What are some of the return-to-work hurdles that older workers face on the job and how can employers alleviate these?
McDowell: Employers need to understand that mature workers are indeed interested in training to acquire new skills and in advancing in their roles, and they are less likely to leave or seek a different job. Yet they are often overlooked for learning opportunities. Companies need to always include them in their development offerings.
Many in this group want a reduced schedule. Astute firms will look for ways to retain their mature employees post-retirement by innovating ways to fashion project-based or reduced-hours roles for those who want them so they can continue to impact the company favorably.
Some have health and safety concerns. Wherever possible, companies should endeavor to structure returning retirees’ work situations as remote or hybrid or at least have health protocols in place and enforced for onsite roles. Mature workers take good care of their health and want to avoid undue risks wherever possible.
Many retirees returning to the workforce have lost some of the self-confidence that they once had. If a former retiree goes to a new company or department, have a plan to introduce them and assimilate them well with the new work team.