Over the past generation, the work trends for older Americans were one of the bright spots in an otherwise decidedly mixed labor force picture. But that is no longer the case.
Both employment and labor force participation rates (LFPRs) for the 55-plus contingent in the American workforce fell sharply during the Covid-19 pandemic—but mysteriously, and unlike rates for all younger working age groups, theirs have yet to recover. Moreover, America is now falling behind other affluent societies with respect to labor force participation for its older citizens. As we enter an era of population aging and potentially prolonged below-replacement fertility, retrogression in workforce involvement by older American men and women is a new normal we can ill afford.
From the early postwar era until roughly the end of the Cold War, older Americans had been steadily leaving the workplace—a testimony of sorts to the fact that Social Security, private pensions and personal savings finally offered older workers the economic security to retire rather than toil until they dropped.
But then, from the early 1990s until the eve of the Coronavirus pandemic, there was a turnaround—and the US became an exemplar of successfully bringing older people back into the workforce. Starting around 1993, both workforce participation rates and work rates for older Americans picked up sharply.
In all, LFPRs for the 55+ group rose by over 10 percentage points between 1993 and 2019. While labor force participation for these older Americans seemed to plateau at this new, higher level after the Great Recession, work rates (employment to population ratios) continued to grind gradually upward. Indeed, 2019 work rates for older Americans hit their highest level in almost sixty years (since 1960).
Then something strange happened. With Covid-19, workforce participation rates for older Americans suffered a shock from which they have not yet managed to recover.
Curiously, LFPRs for Americans 55+ were lower in 2024 than in 2020—before the rollout of the new mRNA vaccines. This is no longer “Covid shyness,” at least by any general understanding of that term. Nor can the continuing labor force absence of large numbers of older men and women be attributed to the “Covid windfall” of transfer benefits dispensed during the emergency to forestall the risk of economic collapse during the lockdowns; by the reckoning of most observers, those winnings would have been spent by now. Yet in early 2025 LFPRs for the 55+ population remain stubbornly stuck almost two percentage points below the pre-pandemic level—and by the looks of the chart above, may still be trending down.
The faltering trends for older workers stand in contrast to those for the rest of the US labor force. LFPRs for US youth (the 15–24s) are higher today than before the pandemic. LFPRs for prime age women (the 25–54 group) are higher today than ever before. Even for the notoriously troubled prime age male contingent, LFPRs for early 2025 look to be back up to pre-pandemic levels.
Older workers remain the troubling exception to the general post-pandemic recovery of the US labor force. It is a consequential exception. At 2019 LFPRs, America would have close two million additional men and women in its workforce. Despite the great influx of working age migrants during the Biden Administration’s “Southern Broder Crisis,” the US workforce was still almost a million and a half would-be workers below pre-pandemic trends as of January 2025—at least, according to official employment statistics. (The Current Population Survey, the source of US monthly job reports numbers, may still be catching-up in the wake of the Biden influx.)
The drop-off in older workers, in other words, appears to account for the entirety of the current workforce shortfall—and then some.
There was a time when the US possessed a general comparative advantage against the rest of the OECD with respect to its levels of workforce participation for older citizens. No longer. True, workforce participation and employment rates for Americans 65 and older continue to exceed those of Europe and the OECD as a whole. But this is a low bar—less than one in five senior citizens in America is in the labor force today.
On the other hand, in the critical 55–64 cohort—a group that may or may not be in the workforce—US LFPRs have just been overtaken by the OECD. At the turn of the century, America enjoyed a 10-point edge here. Even more stunning, the US has now fallen behind Europe in workforce participation for its 55–64, sacrificing the over 20-point lead it enjoyed in the year 2000.
America’s older worker problem deserves much greater attention. In our aging society, this is a demographic vulnerability. It warrants no complacency.
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