Higher Retirement Age Already a Reality

Facts matter: Sign up for the free Mother Jones Daily newsletter. Support our nonprofit reporting. Subscribe to our print magazine.

Casey Mulligan notes that among workers aged 25-55, hours worked during the recession has declined about 10%. But for older workers, the decline has been far less. For those over 62, hours worked has actually gone up. Why?

[One] possibility is that the labor market distinguishes, at least in a rough way, among workers according to their willingness to work, and that the stock market and housing market crashes have especially stimulated older people to work more. (Young people, on the other hand, had fewer assets before the recession, so a decline in asset prices has little direct impact on them.) This effect tends to increase with age because the propensity to own assets for current needs and future retirement also increases with age.

If you were thinking about early retirement at age 55, you’re going to think again if your 401(k) has tanked, your house has lost 30% of its value, and your kids are still living at home because they can’t find a job. You also might be motivated to work harder than before because you’ve seen what’s happened to your friends who have lost their jobs and are now, for all practical purposes, unemployed forever because no one wants to hire a 58-year-old who’s been out of work for two years.

Which is just to say, this makes sense to me. Older people are highly motivated to keep working, and that means fewer jobs are opening up for younger people. Welcome to the recession.

THE END...

of our fiscal year is Thursday, June 30, and we have a much larger fundraising gap than we can easily manage with only days left to go.

Right now is no time to come up short: If you value the hard-hitting, democracy-protecting, justice-advancing journalism you get from Mother Jones, please help us keep charging as hard as we possibly can with a much-needed and much-appreciated donation today.

payment methods

THE END...

of our fiscal year is Thursday, June 30, and we have a much larger fundraising gap than we can easily manage with only days left to go.

Right now is no time to come up short: If you value the hard-hitting, democracy-protecting, justice-advancing journalism you get from Mother Jones, please help us keep charging as hard as we possibly can with a much-needed and much-appreciated donation today.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate