Middle-aged and Older Adult Employment and the Perceived Risk of Running Out of Money during COVID-19: A Dynamic Panel Data Analysis.

Abstract

The coronavirus disease of 2019 (COVID-19) adversely impacted the health of middle-aged and older adults and altered their economic outlook. Several national polls revealed older adults felt stress about money and many reported difficulties in paying expenses during 2021. While such descriptive reports have raised awareness, peer-reviewed studies utilizing panel data can offer additional insight. As such, the purpose of this study was to contribute to this growing literature by examining the demographic, economic, and health factors associated with employment and the perceived risk of running out of money for middle-aged and older adults during the pandemic. This study utilized the April-May 2020, April-May 2021, and March 2022 waves of the Understanding America Study (UAS). Next, a dynamic panel data model was formulated to account for reverse causality and unobserved heterogeneity with a sample of 2,302 adults between the ages of 50-74. Employment (-2.77, p<0.05) was negatively associated with the perceived risk of running out of money. Male, higher education levels, currently married, and health insurance status also exhibited a negative association. Meanwhile, a positive association was found for non-White (6.79, p<0.01). Financial well-being is an important consideration in later-life and what role employment played during the COVID-19 pandemic is a worthwhile examination. A better understanding of which factors may be associated with the perceived risk of running out of money during the pandemic can be useful when devising policies which address financial security for middle-aged and older adults.