Older workers aren’t retiring, creating career gridlock for younger ones
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Increasing numbers of older Americans are putting off retirement, creating career ladder gridlock that is impacting younger workers.
Why it matters: As older workers stay in their jobs longer, their Gen Z and Millennial colleagues are often locked into lower-paying, junior-level roles.
State of play: The share of U.S. adults aged 65 and older in the labor market has steadily increased since the late 1980s.
- A 2023 retirement confidence survey from the Employee Benefit Research Institute (EBRI) found that 33% of workers planned to retire at age 70 or older, or never. That's up from EBRI's 2021 survey, in which 26% of workers said the same thing.
- Declining social security benefits and fewer jobs offering pension plans have contributed to a landscape in which most Americans aren't financially on track for retirement.
- People generally are living longer and staying healthier as they age. Both play a role in how older workers remain on the job.
The big picture: This has contributed to a "tricky situation" on the career ladder "because there are only so many jobs to go around, especially at the higher levels," Colleen Paulson, a career consultant, told Axios.
What they're saying: "If you're not moving up in the corporate ladder because there's no space for you to move, then your earning potential is actually stalled," Jasmine Escalera, a career expert, told Axios.
- This can cause workers stress and anxiety but also fuel job hopping, she said.
- "We may end up seeing a ripple effect where younger generations have a hard time increasing their earning potential, which could potentially also impact their ability to retire at a certain age as well," Escalera said.
Between the lines: Career ladder gridlock works hand-in-hand with a slowing job market and high interest rates to create a difficult environment for younger workers who want to achieve traditional life milestones, according to Paulson.
- "I can see how people would delay having kids or delay buying a house because they're not sure if their financial situation can support that, she said.
Reality check: The majority of older workers aren't staying on the job longer, Gary Officer, CEO of the Center for Workforce Inclusion, told Axios.
- A Pew Research Center survey published in December found that 19% of Americans aged 65 and older were employed in 2023. While that's roughly double the share from 35 years ago, it also means that the vast majority aren't employed full-time.
- "Most of the in-demand occupations in this country [require] a higher level of technological proficiency that skews overwhelmingly towards younger people," Officer noted.
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