Labor Force Participation is Going Up in the U.S. and Around the World

By Chris Adams

For several decades, retirement was a relatively simple thing: A “third act” in a person’s life, something that followed childhood and the years of working and accumulating assets.

That’s according to Courtney Coile, an economist at Wellesley College, who studies how that very notion is changing – and not just in the U.S.

In her studies of labor forces in a dozen developed countries around the world, Coile has seen the same general trends: a decline in the workforce among those in their 60s from the 1980s to the 2000s followed by an increase.

“Everybody has a U-shape, although the levels are different,” she said.

In some nations, the increases have been dramatic. In Germany and the Netherlands, for example, the share of men aged 60 to 64 in the workforce jumped 35 percent or more.

In the U.S. among even older workers – those age 65-69 – working rates went from a quarter to a third of men; for women, they went from less than 20 percent to nearly 30 percent. Overall, the average age of retirement has increased by 2 to 2.5 years for American men and women

Why is that?

In a session with National Press Foundation fellows, Coile went over some of the dominant trends, with an emphasis on one key factor: the structure of each nation’s social welfare programs. Coile also co-directs the National Bureau of Economic Research‘s International Social Security Project, which has a team of researchers in a dozen developed countries working together to conduct parallel studies that are combined to draw cross-country comparisons.  The group’s most work has found that 80 to 90 percent of the differences across countries in work at older ages in the late 1990s could be explained by differences in their social security programs.

This program is funded by the Alfred P. Sloan Foundation. NPF is solely responsible for the content.

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