Policies to encourage older people to remain in the workforce

Abstract

If older people in G7 countries continue to withdraw from the workforce by their early 60s, many will not have enough income to ensure a secure retirement. Combine the retirement income crunch with the dramatic increase in life expectancy, and continued employment in later life appears to be a promising option for ensuring the financial security of older people. The hard questions are whether older people will offer their services and whether employers will retain or hire them. This paper, which focuses primarily on the US experience, explores the potential supply of and demand for older workers and looks at some proposals to help increase their workforce participation. From the workers' perspective, the need for additional income suggests that they will wish to remain in the workforce longer. From the employers' side, older workers have potential advantages and disadvantages. The paper also assesses policy proposals for improving the prospects for older workers in the US.