Our first home was in the northwest suburbs of Chicago. As much as we liked the house, we were not the first owners, and there were certain things we wanted to “fix.” The first of these was the family room, where we figured to spend a lot of our time — and which the previous residents had seen fit to line with pine paneling. Our plan was to take down that paneling and replace it with wallpaper, to modernize and “open up” the room.
As I pulled back that first strip of paneling, I was nearly blinded by a flash of orange — what turned out to be a misbegotten shade of 1970s floral print wallpaper that lay underneath the paneling. “No problem,” my wife assured me; in fact, this might actually work to our benefit, she said, in that it implied that the previous owners would have treated the wall before putting up that paper.
Well, after 15 minutes of struggling to separate the paper from what lay beneath it, it was clear that they had not done so. Moreover, one of the previous owners had apparently pasted the orange floral print over another wallpaper, this one some hideous lime green color. Nor, as it turned out, was that the last of the layers (we stopped counting at six).
While we had made what we thought were reasonable conclusions about the size of the project based on the topline evidence, it was now clear that more — much more — was going on underneath (and apparently had been for some time). Fortunately, we discovered that reality before I had ripped down so much paneling that we were committed to that course of action.
As retirement plan advisors well know, a growing concern for employers, workers and policymakers alike is the changing composition of the American workforce and what that might mean for benefit plan designs, succession planning and workforce management.
A recent EBRI Notes article examining the most recent U.S. Census Bureau data on labor force participation notes that the rates of younger workers increased when those of older workers declined or remained low during the late 1970s to the early 1990s. While both increased for a period of time in the latter half of the 1990s, as the labor force participation rates of younger workers began to decline in the late 1990s, the rates for the older workers continuously increased. In 1997, workers ages 25-54 accounted for 83.9% of all workers age 25 or older, while those ages 55-64 accounted for 12.0%, and those age 65 or older, 4.1%. However, by 2012, the fraction of older workers expanded; those ages 55-64 represented nearly one in five workers, while those 65 or older constituted 7.0% of the labor force. Meanwhile, the percentage of workers 25 or older represented by those ages 25-54 slipped to 73.8%.
A closer examination of trends within the group age 55 and older reveals some additional patterns of interest. For those ages 55-64, the upward trend in the 1990s and into the 2000s was driven almost exclusively by the increased work force participation of women, while the male participation rate was flat to declining — that is, until you look at the rate for those ages 65 or older, where the EBRI analysis shows that labor force participation increased for both males and females over that period.
So, while it’s not clear whether older workers are filling a workforce gap or closing off opportunities for younger workers, older workers — notably older female workers — are certainly more plentiful in the labor force today, with potential workforce planning implications.
Ultimately, of course, it’s important to know what the numbers are and to examine the trends those numbers suggest over time. And sometimes you can’t fully understand the topline trends — and shouldn’t commit to a course of action — without first knowing what’s underneath.
