Quick look: There’s a new wave of talent (re-)entering the labor market: retirees. Nearly 12 million of these seasoned workers are back in the office, many of whom hope to work for several more years. Here’s why there are retirees returning to work, the value they can offer companies, and how a PEO can help SMBs attract and retain them.
Sometimes dubbed the Great Unretirement, there is a wave of baby boomers returning to the U.S. workforce. These veteran employees can prove valuable to companies with their wealth of experience and knowledge, and the reasons these workers are returning may surprise you.
With tens of millions of workers in their 50s and older, this labor pool presents many opportunities for employers. Many of these employees carry decades of experience and can pass their skills and knowledge to subsequent generations of staff, helping develop the company’s institutional knowledge.
What’s more, recent research found that over half of returning retirees want to work for at least three years, meaning they have the potential to impact employers significantly.
The Great Unretirement
The rush of older workers going back to the labor force is a new trend.
According to the U.S. Census Bureau Household Pulse Survey, a rising share of adults 65 and older is working. In spring 2020, 19.5% of this age bracket was working. That figure jumped to about 22% in August 2022, or over 11,800,000 people. And although the number of retired U.S. workers 65 and older is nearly 3% higher than in 2020, the share of working older adults is more than 2% higher.
New Jersey saw the largest jump in older adults returning to the workforce of all the states since the COVID-19 pandemic began. In spring 2020, approximately 18% of those age 65 and older, or over 220,000 people, were employed in New Jersey. By spring 2022, that figure rose to about 575,000 people, or roughly 37% of the age bracket. Other states with sizable increases during this period include Pennsylvania and West Virginia.
Why the return?
Competitive pay and benefits, more flexibility, and the desire to connect with colleagues are luring retirees back to the office.
The job market is booming, leading many older workers back into the labor force. The latest U.S. Bureau of Labor and Statistics data reports over 11.2 million job openings, making competition for talent fierce among companies. This has led many organizations to offer enhanced benefits, higher pay, and more.
In fact, the median weekly earnings of full-time workers were $1,041 in the second quarter of 2022, in contrast to $996 one year prior. Additionally, one-quarter of employers plan to raise employees’ salaries for 2023 by 5-7%.
A social connection
While financial concerns fuel some retirees’ return to work, most of these employees want to head back to the job for other reasons.
Joblist recently surveyed over 15,000 job seekers and found that 60% of retired workers looking to re-enter the workforce are merely “looking for something to do.” There is undoubtedly an emotional tie to heading back to work: 52% of those surveyed said they are “happy” to return, and 42% feel “excited.”
This anticipation could be because not all those who retired during the pandemic did so on their own accord—some may have been laid off before they were ready to retire.
While many retirees want to work for non-monetary reasons, finances play a factor in why some step into employment. The Joblist survey confirmed this, finding that 27% of retired job seekers are returning due to financial needs.
The national inflation rate is the highest since 1981, and a falling stock market is affecting retirement savings, both factors directly impacting the ability of some of today’s retirees to make ends meet. In fact, Boston College’s Center for Retirement Research found that over one-third of those ages 65 to 69 cannot pay for one year of minimal long-term care without depleting their resources. That percentage jumps even higher for those without high school degrees, racial minorities, and unmarried women.
What do these workers want?
With so many talented retirees returning to work, here’s what SMB employers can offer to entice them to apply to and work for their organization.
Today’s workforce is multigenerational, and their benefits should be, too. Businesses looking to attract and retain returning retirees should consider offering the following benefits, which may prove to be especially valuable to this generation:
- Comprehensive health insurance: A competitively priced plan that covers preventive services and has an option for a health savings account (HSA) could be especially appealing. HSA funds roll over each year, earn interest, and remain with the employee when they retire or leave the organization for other reasons. Furthermore, these funds can be used to pay for healthcare expenses in retirement.
- 401(k) retirement plan: Although these workers may have retired once already, they can still contribute to an employer-sponsored 401(k).
- Voluntary benefits: Older workers may enjoy the option to enroll in certain voluntary benefits like a cancer support program or a pet insurance policy (baby boomers are the second largest share of pet owners in the U.S.!)
- Financial wellness training: Approximately 40% of retirees regret not saving more of their income, and over half regret not saving sooner. Employer-hosted training that educates and connects employees with financial advisors can raise workers’ confidence and equip them with the tools they need for a successful future.
Proper training can help retirees returning to the workplace experience a smooth transition.
The use of technology in the workplace has skyrocketed in the last few years. Employers should help retirees learn new workforce collaboration tools, like Microsoft Teams, Zoom, or Slack, and any other technology specific to their role.
An accommodating schedule is key to returning retirees. The Joblist research referenced above found that almost 80% of these employees want to work part-time.
Returning retirees may desire to volunteer, spend more time with family, have frequent doctor appointments, or simply desire a less busy schedule. Providing a flexible schedule can show them that their organization’s leadership cares about their needs at this point in life.
An accepting culture
Unfortunately, ageism exists in many workplaces today. Recent AARP research revealed that nearly 80% of employees aged 40-65 experienced or witnessed age discrimination in 2020 alone.
Organizations can combat this prejudice by including age in their diversity, equity, and inclusion (DEI) policies, assigning de-bias training to their talent acquisition teams, and providing anti-bias training to all staff.
Attract the right talent with the right partner
Many factors are involved in ensuring your company is attractive to job seekers and retirees returning to work. Your benefits package must speak to their needs, your professional development programs must motivate and inspire them, and your culture must welcome and accept them.
If you want to appeal to the seasoned workers returning to the talent pool but already have your hands full with day-to-day human resources (HR) tasks, you’re not alone. A professional employer organization (PEO) can help you tweak certain aspects of your organization to attract, hire, and retain the talent you need most.
ExtensisHR, a nationally recognized PEO, offers the following services designed to fuel your success:
- Fortune 500-level benefits: A wide range of competitively priced benefits designed to appeal to today’s multigenerational workforce.
- Online training platform: A comprehensive knowledge base featuring on-demand access, immersive learning, integrated learning schedules, and more.
- Dedicated HR assistance: An HR Manager assigned to your account and available to support you as needed.
- Recruiting solutions: Full-service talent acquisition assistance, from job description creation to offer letter consultations (at no extra charge!).
- And more
Is hiring talented retirees on your to-do list? Contact the experts at ExtensisHR to get started today.