Opinion editor's note:Editorials represent the opinions of the Star Tribune Editorial Board, which operates independently from the newsroom.
It's tempting to imagine that the retirees now going back to work are on a bit of a lark. Seen through the distorting lens of stereotypes, they may appear just to have gotten a little bored with a schedule-free life. Maybe they want to meet new people or reconnect with their old crowd.
But that outlook, as an AARP official testified in prepared remarks at the Minnesota Legislature last year, is unconnected to reality. "It is a privileged worldview," said Kate Schaefers, volunteer president of AARP Minnesota, "that assumes … older adults have cushions of savings to draw upon, with earned income just icing on the cake."
Indeed. And speaking of cake, there may be some who won't feel properly retired until they have the kind of going-away party that was a normal part of pre-pandemic workplace culture. But it's a safe bet that most who return to the workforce are acting out of necessity, not whimsy.
Perhaps their retirement savings are invested in funds that have performed poorly during the recent market turbulence. Perhaps they were among the roughly half of families that had little or no retirement savings to start with. After all, many of the people who left the workforce during the early days of the COVID lockdown did so not by choice but because their jobs simply disappeared. The graph of employment figures in March 2020 is a virtually vertical line, straight down to April.
The fortunate ones are those who needed only to speed up their retirement timetable by a year or two, perhaps accepting a buyout along the way. They may even have had employer-funded pension programs waiting for them. But those with less luck had only unemployment insurance to count on, plus Social Security.
And in Minnesota, a further shock lay in wait: a provision that reduced the unemployment checks of some who were receiving Social Security payments. That feature of state law was finally repealed effective this summer, but the repeal was not made retroactive. For many, the damage was done.
They were not alone in feeling a pinch. Their departures added to a pronounced labor shortage in the United States. In Minnesota, about 65,000 workers aged 55 or older left the workforce between the end of 2019 and the second half of 2020, according to Census Bureau data cited by theDepartment of Employment and Economic Development.Nationally, the economy saw a jump in retirement of about 2.4 million people during the first year and a half of the pandemic.
Since then, roughly 1.5 million retirees have gone back to work. In Minnesota, about 28,000 have returned. Analysts suggest those returnees are motivated by a number of factors: It's easier now to find a job, for one thing, and many returning workers say they have found better jobs than they had before. The risk of catching COVID in the workplace no longer seems as acute. And the worst inflation in decades is playing a role as well.
Some employers have been targeting older workers in their recruitment efforts. And the rapid evolution of workplace options, like flexible schedules and remote work, appeals to many seniors as well as to younger workers. Businesses across the country are facing essentially the same quandary: There are many more available jobs than there are available workers.
Clearly, freshly retired Americans represent a resource that can help the country deal with its workforce problem. But just as clearly, the problem is bigger than the worker shortage triggered by the pandemic. The impending departure of retiring baby boomers has been predictable, and predicted, for decades.
A few baby boomers are coming back? Great. But they're unlikely to hang around for long, and they can't take the place of forward-looking workforce development solutions, like immigration reform. Without such initiatives, the U.S. economy will suffer. The mass departure will continue either way.