Sunday, May 20, 2018
Opinion

Column: Early retirement, RIP?

WASHINGTON

We may be witnessing the last gasp of early retirement — not just in the United States but in many industrialized countries. Considering the high unemployment since the 2008 financial crisis, you might expect the opposite. Early retirement would flourish. It would strike many unemployed older workers as the path of least resistance. Can't get a job? Retire instead. Surely this has happened, but it's being diluted by a determination to work longer. Early retirement is in retreat.

So finds a new study of 20 advanced countries done by economists Gary Burtless and Barry Bosworth of the Brookings Institution, a think tank. Excluding countries with depressionlike unemployment — Greece, Portugal, Spain and Ireland — all these nations have experienced higher labor force participation by older workers since 2007. Some gains are startling. In Germany, the share of the 60-to-64 population with jobs went from 33 percent in 2007 to 47 percent in 2012; in the Netherlands, from 30 percent to 44 percent.

This continues a trend of working longer that started in the 1980s and 1990s. In the United States, 52 percent of the 60-to-64 population held jobs in 2012, the same as in 2007. But the share of older people with work or searching for a job — the broad definition of "labor force participation rate" — has continued to rise. Translation: A shrinking share of older Americans are dropping out of the labor force and relying exclusively on retirement benefits and savings.

What's occurring is a massive shift in private behavior. For most of the 20th century, working years decreased in industrial countries. People stayed in school longer and retired earlier. In 1910, reports Burtless, more than half of American men aged 73 were still working; by 1994, half of men aged 62 had retired. This is now shifting: In 2011, only at 64 had half of men retired. At 65, men's labor force participation rate was 46 percent, up from the historical low of 31 percent in 1982. Trends for women are similar.

The causes lie in a messy mix of public policy, improved health, and changes in lifestyles and economic conditions. For the United States, Burtless cites: an increase in Social Security's eligibility age for full benefits from 65 to 66; a shift among employers from "defined benefit" pensions (which provide payments until recipients' death) to "defined contribution" pensions (which provide support only until pension savings are exhausted); and higher education levels among baby boomers. "Better educated people retire later in life," he says, "and baby boomers are much better educated than previous generations."

Similar factors are probably at work abroad: cuts in public programs — or fear of cuts; more economic uncertainty; longer lives and jobs that are less physically demanding. Still, a few advanced countries retain low retirement ages: prominently, France, Italy and Belgium. In 2012, only about 20 percent of their aged 60-to-64 populations had jobs.

On the whole, the lengthening of working lives is a good thing, though with one big caveat. First, the benefit: As populations age, countries no longer can afford to have growing numbers of elderly supported by declining numbers of young and middle-aged. Welfare states are strained, and the costs of caring for the elderly are a main cause. People need to remain productive for longer. Now, the caveat: This transition is happening at an awful time. Without stronger economic recoveries, jobs taken by older workers contribute to the high unemployment of the young.

© 2013 Washington Post Writers Group

Comments
Editorial: Tampa Bay House members fail to stand up to Big Sugar

Editorial: Tampa Bay House members fail to stand up to Big Sugar

Big Sugar remains king in Florida. Just three of the state’s 27 House members voted for an amendment to the farm bill late Thursday that would have started unwinding the needless government supports for sugar that gouge taxpayers. Predictably, the am...
Published: 05/18/18
Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Florida Attorney General Pam Bondi’s lawsuit against the nation’s largest drug makers and distributors marks a moment of awakening in the state’s battle to recover from the opioid crisis. In blunt, forceful language, Bondi accuses these companies of ...
Published: 05/18/18
Editorial: A sweet note for the Florida Orchestra’s violin program for at-risk kids

Editorial: A sweet note for the Florida Orchestra’s violin program for at-risk kids

This is music to the ears. Members of the Florida Orchestra will introduce at-risk students to the violin this summer at some Hillsborough recreation centers. For free.An $80,000 grant to the University Area Community Development Corp. will pay for s...
Published: 05/17/18
Updated: 05/18/18
Trump backs off China tariff threat as China pumps money into a Trump family project

Trump backs off China tariff threat as China pumps money into a Trump family project

In barely six weeks, President Donald Trump has gone from threatening to impose $150 billion in tariffs on Chinese goods to extending a lifeline to ZTE, a Chinese cell phone company that violated U.S. sanctions by doing business with Iran and North K...
Published: 05/17/18
Editorial: Activism as seniors helps put Hillsborough graduates on the right path

Editorial: Activism as seniors helps put Hillsborough graduates on the right path

Lots of teenagers are walking together this week in Hillsborough County, a practice they’ve grown accustomed to during this remarkable school year.We can only hope they keep walking for the rest of their lives.Tens of thousands of them this week are ...
Published: 05/17/18
Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Florida Attorney General Pam Bondi’s lawsuit against the nation’s largest drug makers and distributors marks a moment of awakening in the state’s battle to recover from the opioid crisis. In blunt, forceful language, Bondi accuses these companies of ...
Published: 05/16/18
Updated: 05/18/18
Editorial: Johns Hopkins All Children’s should be more open about mistakes

Editorial: Johns Hopkins All Children’s should be more open about mistakes

A state investigation raises even more concern about medical errors at Johns Hopkins All Children’s Hospital and the venerable St. Petersburg institution’s lack of candor to the community. Regulators have determined the hospital broke Florida law by ...
Published: 05/16/18
Updated: 05/17/18
Editorial: St. Petersburg recycling worth the effort despite cost issues

Editorial: St. Petersburg recycling worth the effort despite cost issues

St. Petersburg’s 3-year-old recycling program has reached an undesirable tipping point, with operating costs exceeding the income from selling the recyclable materials. The shift is driven by falling commodity prices and new policies in China that cu...
Published: 05/15/18
Updated: 05/18/18
Editorial: HUD’s flawed plan to raise rents on poor people

Editorial: HUD’s flawed plan to raise rents on poor people

Housing Secretary Ben Carson has a surefire way to reduce the waiting lists for public housing: Charge more to people who already live there. Hitting a family living in poverty with rent increases of $100 or more a month would force more people onto ...
Published: 05/15/18
Updated: 05/18/18
Editorial: Voters should decide whether legal sports betting comes to Florida

Editorial: Voters should decide whether legal sports betting comes to Florida

It’s a safe bet Florida will get caught up in the frenzy to legalize wagering on sports following the U.S. Supreme Court opinion this week that lifted a federal ban. Struggling horse and dog tracks would love a new line of business, and state l...
Published: 05/15/18
Updated: 05/16/18