The percentage of workers over 55 years old has increased dramatically over the last 20 years, and is expected to rise even more in the next 10 years, according to research from the U.S. Bureau of Labor Statistics. From 1992-2002, the percentage of older workers increased from 11.8% to 14.3%. It stood at 20.9% in 2012, and is projected to reach 25.6% in 2022.
The reasons? People are living longer and are healthier, and many don’t want to retire because they enjoy working. But the increase could also be due to the lack of retirement savings and the fear of outliving their money.
The implications for plan sponsors and advisors are significant, as we outlined in the premiere issue of NAPA Net the Magazine. Benefit costs for older workers are higher, as is absenteeism. Plan design and communication — as well as investments (particularly TDFs) — should be adjusted based on the demographics of the workforce.
