Soon after the pandemic hit in early 2020, over 1.6 million older workers dropped out of the U.S. labor force. In December, more than a year and a half later, nearly half the number — 782,000 people 55 and older — were still on the sidelines.
In contrast, a much higher share of younger workers has returned to the job market.
While some older workers sit it out, many have not retired, and there was not a swell in early claiming of Social Security benefits, one study found. That suggests these people could be drawn back to the workplace, which would be good news for the economy and employers facing a shortage of job candidates.
“The million-dollar question is how many of these older workers will return to the labor market?” said Jennifer Schramm, senior strategic policy adviser at the AARP Public Policy Institute. “I hear people use the term ‘unretire.’ But that’s going to be difficult to predict because so much of this is driven by the pandemic.”
Before the COVID-19 outbreak, about 15% of older workers left their jobs each year. That number doubled to 30.5% by April 2020 and remained near or above 20% for the rest of 2020, according to a December report from the Center for Retirement Research at Boston College.
Overall, the share of older workers leaving the workforce during that first pandemic year rose by a statistically significant 7.6 percentage points, the researchers wrote. But self-reported retirements rose just 1 point over the period, and the monthly claim rate for Social Security payments remained constant.
“I think some of those people are still entertaining the notion of going back to work,” said Gal Wettstein, senior research economist at the center and co-author of the report. “They’re not willing to throw in the towel yet.”
Older workers who could do their jobs from home were less likely to leave the workforce, as were those with college degrees, the study found. But their reservations about returning to the job are similar to concerns among younger employees, he said.
They worry about public health risks and improvements in their workplaces, such as boosting ventilation.
“There are workers who are available under the right circumstances, but clearly we haven’t done enough to bring them back yet,” Wettstein said.
The government’s December jobs report, released Jan. 7, showed a slight decline in the unemployment rate for older workers along with an increase in total employment for those 55 and older. Those are positive developments, but it still takes longer, sometimes much longer, for older people to find work.
The median duration of unemployment was 22 weeks for those 55 and older, twice as long as for those ages 25 to 44, according to data compiled by AARP.
Almost 43% of older job-seekers had been looking for work for at least 27 weeks in December, which means they’re considered “long-term unemployed.” Among those 16 to 54, just under 30% were job hunting for that long.
From November to December, the share of long-term unemployed rose among older workers and declined among younger ones.
“You don’t want to take too much from one month’s report, but you can see a trend: a longer period of unemployment for older workers,” Schramm said.
The labor participation rate, which measures the share of population working or looking for work, has remained stubbornly low for older people.
Shortly after the pandemic, the rate fell to 38.5% among those 55 and older, down from 40.3%. After a brief improvement in summer 2020, participation fell back again. The rate was still 38.5% in December, near the previous pre-pandemic low reached during the Great Recession.
“People are still afraid — afraid for their health, afraid for their families,” said Allison Harding, senior director of career and financial services at Jewish Family Service of Greater Dallas. “They never had that before. In the past, they just wanted a job — period. Today they’re asking: ‘What job do I want where I can be safe?’”
Her agency helps about 1,500 clients a year, and she estimated that about two-thirds of them are 55 and older. Most are not ready to retire, and they’re especially worried about working with unvaccinated people.
Her company requires employees to be vaccinated against COVID-19, she said, and some left because of the rule.
“We’re just like hundreds of thousands of companies trying to deal with this,” Harding said. “This is the new now. We have to adapt and create an environment where older workers feel safe.”
Many clients want a work-from-home job, and a growing number of employers are recruiting remote workers. But older candidates may not have the required computer skills, from handling multiple screens to working with spreadsheets and digital platforms.
Grocery stores and restaurants have lots of openings: “Could older adults get those jobs? Absolutely,” Harding said. “Do they want those jobs? That’s the challenge.”
In addition to health risks, many don’t want to be on their feet for hours and don’t want to confront customers over masks and safety protocols, she said. Their best choice may be to reinvent themselves by learning new skills and industries. The U.S. had over 10.5 million job openings in November, roughly twice the typical number before the pandemic.
Still, they may face a long process, and not just because it takes a while to learn new tricks. In a survey by AARP last year, 78% of older workers said they had seen or experienced age discrimination in the workplace. That was the highest level since AARP began tracking the question in 2003.
“There’s ageism with older workers; it’s just inherent in our hiring,” Harding said. “It’s a terrible thing to say, but it’s the truth.”