Seniors in the Workforce

Inflation is unpleasant for nearly all consumers, but it hits especially hard when you’re on a fixed income. The US Bureau of Labor Statistics reported in May 2024 that consumer price indices for shelter and food continued to rise. According to the Senior Citizens League, adults who retired in 2000 have lost 36% of their buying power to inflation. Put another way: Retirees need over $500 more a month to maintain the lifestyles and buying power they had when they first retired.

Instead of sacrificing their lifestyles (or selling their homes) to make up for that $500/month deficit, almost 30% of seniors surveyed have returned to the workforce.

"Retirement plans for many seniors have been impacted by inflation — both due to a desired timeline for retirement and a less clear template for success with their investments amid inflation’s impact. These problems only compound for seniors relying on fixed income,” says John Farrell, Director of FP&A and Treasury at Caring. “This has caused seniors to stay in the workforce longer, or come out of retirement to maintain their existing lifestyle or cover growing needs such as medical expenses.”

In June 2024, Caring.com partnered with Pollfish to survey 1,500 seniors between the ages of 62 and 85. The goal of the survey was to understand how inflation impacts seniors and how many seniors are either delaying retirement or rejoining the workforce. 

Caring.com created this survey to highlight the impact of inflation on seniors’ retirement plans, and to provide resources for seniors who may be looking to rejoin the workforce. Caring.com is committed to empathetically supporting caregivers with guidance, vital resources, and tangible solutions in their search for senior care.

Nearly 1 in 3 seniors surveyed are currently working full or part-time, and inflation is one of the top reasons they haven’t retired.

Beyond the increased cost of living, different age cohorts have different motivators for being in the workforce. All respondents aged 80-85 rejoined or remained in the workforce to pay down medical and other debts, and because they didn’t initially save enough for retirement. 

Working seniors aged 67-79 also returned to pay down nonmedical debt (30%) or because they did not save enough for retirement (51%). But unlike the eldest cohort, these seniors retained or rejoined their jobs to be more social (15%) or learn a new skill (15%). 

Unretiring to be more social was the top reason (35%) seniors aged 62-66 returned to work. Other motivators for seniors rejoining or remaining in the workforce include wanting to have extra discretionary funds and being able to provide for children.

Of seniors not currently in the workforce, 14% consider themselves very (5%) or somewhat likely (9%) to unretire in the near future. Inflation is a major reason behind their potential choice, with 52% citing it as a reason they are considering coming out of retirement

Other reasons retirees may rejoin the workforce include paying down non-medical debt (33%) and supplementing Social Security income. Additionally, 33% of seniors say they are realizing they may not have saved enough to retire.

Inflation and cost-of-living increases are the largest reason seniors are returning to the workforce. Inflation is also the largest motivator those on the cusp of unretiring list as the reason they might seek employment.

Paying off medical (11%) and other debts (33%) were also motivating factors for seniors who returned to work. Many working seniors (33%) thought they’d saved enough money to retire and are now finding out they’ve fallen short.

For some seniors, enrichment is a valuable part of their job. Many respondents (51%) said they remained in the workforce at least in part because they simply enjoy working.

Jobs stimulate us in ways that may be difficult to duplicate in retirement. Combating boredom ranked high (27%) on the list of reasons seniors came back to work, as did the social aspect of having a job (24%).

For the seniors still at work, fear of boredom (37%) is also a large factor prompting them to decline retirement. Boredom in retirement was the fourth most-popular reason respondents gave for keeping their jobs, behind enjoying their work (51%), increased cost of living (46%), and not saving enough for retirement (43%).

Respondents are enjoying retirement at the cost of other luxuries. Seniors who retired report cutting back in three major areas: leisure activities (60%, food (47%), and travel (57%). Other areas retirees reduced spending include restaurant takeout and shopping for clothing.

Being back on the payroll doesn’t necessarily soothe the pinch of inflation. Like their retired counterparts, inflation has made working seniors cut back on leisure activities (63% of respondents), food (39%) and travel (52%), even though they have money coming in. 

While retirees’ sacrifices appear aimed at enabling their retirement to continue, seniors in the workforce make the same sacrifices primarily to maintain their current living situation.

Having a paycheck again may give seniors autonomy over their living situation; 5 in 10 working seniors are not living with relatives or roommates — and they don’t plan to. Of the seniors who have clocked back in, 73% live in homes they own.

But homeownership is tenuous for more than a few seniors. Seniors who remain retired worry about losing their homes. Specifically, 6% of respondents not in the workforce fear they will experience homelessness within the next year. When broadened to include respondents who have unretired, the amount of seniors who worry they’ll lose their homes rises to 7%.

Whether they rejoined the workforce or not, inflation is causing seniors to limit their medical appointments (16%). A little over 12% of respondents say the high cost of living has caused them to reduce how much they spend on their medications, which could mean changing pharmacies or going without the medication entirely.

Retirees and working seniors alike said they had to lower what they spent on their prescriptions to combat the rising cost of living. Prescriptions remain a priority, though. Across the board, survey respondents opted to reduce their visits to medical professionals instead of reducing spending on medication.

If you’re thinking about rejoining the workforce after retirement, consider using some of the resources below to ease your reentry.

• Digital Skills Ready@50+ : This AARP partnership with the Google Tides Foundation gives seniors the digital essentials to find new jobs.
• Back To Work @50+ : AARP offers this job training program to provide support for rejoining the workforce.
• The Senior Community Service Employment Program (SCSEP): Get job training through the Center for Workforce Inclusion and various state-based programs
• Path Forward: This nonprofit is focused on helping folks return to work after a career break, including unretiring.