The Bureau of Labor Statistics (BLS) today reported a 2.8% unemployment rate for workers age 55 and older in September, a decrease of 0.3 percentage points from August.
Older workers often need to continue working to make up for inadequate retirement savings due to lost pensions and inconsistent employer contributions. Yet, from 2008 to 2014, at least 52% of retirees over 55 left their last job involuntarily, the result of job loss or a deterioration in health.
Those pushed into retirement early face barriers to returning to work. They are likely to be unemployed longer than younger people, and when they find a job they will earn on average 25% less than their previous salary.
Working longer is not a solution to the retirement savings crisis. Workers cannot rely on being able to work until they are ready to retire. Those who have inadequate retirement accounts and leave the workforce involuntarily are at risk of being downwardly mobile and falling into poverty.
To ensure people can retire when they need to without experiencing deprivation, we need to strengthen Social Security and create Guaranteed Retirements Accounts (GRAs). GRAs are universal, secure retirement accounts funded by employer and employee contributions throughout a worker’s career paired with a refundable tax credit. Together, these proposals would allow all Americans access to dignified retirements after a lifetime of work.