The Bureau of Labor Statistics (BLS) today reported a 3.4% unemployment rate for workers age 55 and older in February, a decrease of 0.1 percentage points from January.
While the headline unemployment rate for older workers is low, women still face sex discrimination in the labor market. Older women earn less than men. The gender pay gap for full-time workers aged 55 to 64 is $13,000, with men earning an average of $50,000 a year compared to women’s $37,000. The earnings gap for minority women is even larger. Black women average $35,000, or $15,000 less than men, while Hispanic women average $27,000, or $23,000 less than men.
The less workers earn, the higher the poverty risk in old age. Women are at even higher risk because they live on average 2.5 years years longer than men, and thus need to save more.
Thirty-six percent of elderly women are poor (income below $11,880) or near-poor (income below $23,760) compared to 28% of men, a gender poverty gap of 8 percentage points. Reflecting their earnings gap, the poverty gap between all men and black and Hispanic women is larger. Forty-three percent of elderly Hispanic women are poor or near poor, 15 percentage points more than men. And more than half (51%) of black women are poor or near poor, 23 percentage points more than men.
Social Security alone is insufficient to lift women and minorities out of poverty in retirement. To ensure adequate retirement income, we need to both strengthen Social Security and ensure all workers have access to a retirement plan. Guaranteed Retirement Accounts (GRAs) are individual accounts requiring contributions from both employees and employers throughout a worker’s career. They provide a safe, effective vehicle for workers to accumulate personal retirement savings.