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Dissecting the Pandemic Retirement Surge

Owen Davis and Siavash Radpour ()

No 2021-03, SCEPA policy note series. from Schwartz Center for Economic Policy Analysis (SCEPA), The New School

Abstract: One of the most pressing questions facing policy makers is how quickly the labor force might return to its pre-pandemic strength. Answering this question requires understanding the employment and retirement trajectories of older workers in the pandemic. The labor force is roughly 3.8 million workers short of where it would be if we still lived in the pre-Covid economy, and nearly half of this shortfall is accounted for by those 55 and older. Meanwhile, the retired share of the population is roughly 2 percentage points above its pre-pandemic trend line (Davis, 2021). Dissecting the Pandemic Retirement Surge finds that: In explaining the sharp increase in the retired share since Covid-19 hit, the drop in “unretirement,†that is, the decrease in flows from retirement to employment, plays only a minor role. The most important driver of the recent increase in retirements consists of higher flows into retirement among workers who were employed in the year before the pandemic. The retirement of workers who became unemployed due to the pandemic also contributed significantly to the increased retired share.

Keywords: older workers; retirement; Covid-19; labor force flows (search for similar items in EconPapers)
JEL-codes: E21 E24 I14 J32 J38 J62 J83 (search for similar items in EconPapers)
Pages: 6 pages
Date: 2021-12
New Economics Papers: this item is included in nep-age and nep-mac
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