COVID-19 has some older workers rethinking retirement
Share Now on:
The economic outlook right now is uncertain, if not outright grim. A lot of groups are experiencing the financial consequences of the coronavirus pandemic differently, including older workers.
Lynne Lippmann is a clinical research specialist in St. Louis. Because of the pandemic, the university where she works needs to cut costs. Some people were furloughed, and Lippmann will have her hours reduced by half.
“When they cut the hours, one of the things we discussed was transitioning that over the next few months to retirement,” Lippman said. She’s 70 and was already planning to retire later this year. “It’s sort of just speeded up the process a little bit.”
People 55 or older make up about 1 in 4 workers in the labor force today. And, so far, they’ve experienced fewer job losses compared to their younger counterparts.
“Historically, older workers have been less likely to lose their jobs than younger workers,” said Richard Johnson, director of the program on retirement policy at the Urban Institute. “Older workers have more seniority that does tend to protect them.”
That’s the good news for older workers, but Johnson said when they do lose their jobs, “their unemployment durations are very long.” Johnson said during the Great Recession, people 62 or older who were laid off were much less likely than younger workers to ever get another job.
And that created another trend.
“There was a huge spike in 2008 and 2009 in people claiming their Social Security benefits early, right at 62, or just whenever that job happened to disappear,” said Matt Rutledge, a fellow at the Center for Retirement Research at Boston College.
Meaning people chose to take a smaller Social Security check for the rest of their lives rather than face months or years of potentially fruitless job searching.
And Rutledge expects another big surge in workers forced into retirement this year. Today, those that still have their jobs can find that even carefully planned retirement strategies may need revising given all the market turmoil.
“When they see their accounts fall down in value, it’s something that they really worry about whether or not they’re going to be able to retire the way they want or whether or not they can stay retired,” said David Amann, a financial adviser with Edward Jones.
So he’s checking in and reviewing plans.
“Asking them how much longer would we have to work in order to live the retirement we want, or what sacrifices would we have to make to retire now,” he said.
He’s encouraging them to make choices while they still have options.
COVID-19 Economy FAQs
It’s still the question on everyone’s minds: What’s going on with extra COVID-19 unemployment benefits?
The $600-a-week payments have ended, officially, as of July 31. For now, there is no additional federal pandemic unemployment assistance. House Democrats want to renew the $600 payments. Senate Republicans have proposed giving the unemployed 70% of their most recent salary by this October, when state unemployment offices have had time to reconfigure their computer systems to do those calculations. Until then, jobless workers would just get another $200. But, nothing has been signed into law yet.
What’s the latest on evictions?
For millions of Americans, things are looking grim. Unemployment is high, and pandemic eviction moratoriums have expired in states across the country. And as many people already know, eviction is something that can haunt a person’s life for years. For instance, getting evicted can make it hard to rent again. And that can lead to spiraling poverty.
Which retailers are requiring that people wear masks when shopping? And how are they enforcing those rules?
Walmart, Target, Lowe’s, CVS, Home Depot, Costco — they all have policies that say shoppers are required to wear a mask. When an employee confronts a customer who refuses, the interaction can spin out of control, so many of these retailers are telling their workers to not enforce these mandates. But, just having them will actually get more people to wear masks.
You can find answers to more questions on unemployment benefits and COVID-19 here.
As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.
Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.
Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.