Older Women: Goodbye Retirement

The Labor Force Participation Rate for Americans over the age of 65 – particularly women – has literally skyrocketed in recent years.

An analysis by Investing.com shows that since January 2000, the rate of participation in the workforce for Americans aged 65 and over soared by 50 percent, including a whopping 67 percent increase for women!

The report, “Structural Trends in Employment by Age Group,” was written by Doug Short, Vice-President of Research for Advisor Perspectives. He specializes in the analysis of long-term trends in economic and market data.

Short  said the “vision of the good life in retirement” that was undergirded by Social Security and Medicare became a “standard expectation” for pre-Boomer generations . He said the reality today is that “an increasing number of Americans aged 65 and over are delaying retirement, and many who did retire have now reentered the workforce.”  Short states the recession, including “two savage market selloffs,”  is driving  the trend.

Age Discrimination

In my new book, Betrayed: The Legalization of Age Discrimination in the Workplace, I show that age discrimination has a direct relationship to poverty in retirement. Older workers often are forced out of their jobs and cannot find new jobs because of overwhelming and blatant age discrimination in hiring. Many are forced to work in low-wage jobs or to  spend down their savings until they can age into early “retirement,” which results in a 25 percent (or more) cut in Social Security benefits for the rest of their lives.

But nobody seems to care.

I note the Age Discrimination in Employment Act of 1967 was weak and riddled with loopholes to begin with and has been further eviscerated by the U.S. Supreme Court.  Meanwhile, I show that  the U.S. Equal Employment Opportunity Commission has virtually ignored a tsunami of age discrimination complaints, President Obama signed an executive order in 2010 that permits the federal government to discriminate against older workers and the U.S. Congress has failed for five years to  pass the Protecting Older Workers Against Discrimination Act, which would make it slightly easier (not much) for older workers to successfully sue for age discrimination. Lastly, the organization that many Americans look to for advocacy for older workers, the AARP Foundation, seems more interested in fund-raising than actually advocating for older workers.

Older Women Suffer

According to Money Magazine, women are almost twice as likely as men to live below the poverty line during retirement, with single and minority women struggling the most (see chart).

Life below the poverty line (Source: GAO analysis of Census data for 2012)

Population Male Poverty rate  Female poverty rate
All 65 and older  6.6% 11%
Married 4.7% 4.9%
Widowed 10.1% 14.5%
Divorced 12.2% 17.1%
Separated 10.8% 35.4%
Never married 15.7% 23.2%
White 4.6% 8.6%
Black 13.2% 21.3%
Asian 11.6% 11.9%
Hispanic 19.1% 21.8%
On average, women 65 years and older rely on a median income of around $16,000 a year — roughly $11,000 less than men of the same age, according to a Congressional analysis of Census data. And many older women rely exclusively on Social Security benefits. The reason that older women are plunged into poverty in their old age seems obvious. Women earn less during their lifetime and consequently save less and women  live longer. And, of course, older women suffer from outrageous age discrimination in employment.

Prescription for an Impoverished Retirement

Check out my guest blog post on the web site of the International Federation on Ageing (IFA)  entitled, “Prescription for an Impoverished Retirement.”    The prescription isn’t for something any doctor would recommend. It is rampant, unaddressed age discrimination in employment that makes it impossible for older workers in America to adequately prepare for a financially sound retirement. The IFA, based in Toronto, Canada, works to improve the lives of older people around the work through collaboration between government organizations, academia, policy makers and the private sector.