Retirement and working longer
You’ve heard that we’re going to work longer, right? The trend is well under way. Look at this chart.
It’s from Congressional testimony on March 28 by Michael Calabrese, senior research fellow at the New America Foundation. In Retirement (In)security: Examining the Retirement Savings Deficit, Calabrese notes that the share of income for Americans 65 and older coming from wages has doubled since the mid-1980s. It’s a huge increase.
In sharp contrast, the share of asset income has plunged from more than 25 percent to about 12 percent, the lowest level in half a century.
As you can see, the share of income from pensions and Social Security has been relatively flat for a decade.
“This seems to confirm what some recent opinion surveys have shown, which is that a steadily growing portion of the workforce will continue to work at least part-time well beyond the ‘normal’ retirement age of 65 or even 67 (as it phases in for Social Security),” he told the Economic Policy Subcommittee, Committee on Banking, Housing and Urban Affairs. “While remaining employed will help compensate for a rising disparity in the ownership of income-producing assets (outside of retirement accounts), it will also impact labor markets by potentially reducing the availability of work, opportunity and rising real wage levels for younger workers.”
Jobs matter, for the young and the old.