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Subject: Baby boomers hardest hit by recession Date: 2/3/2013 6:05 PM
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http://www.nytimes.com/2013/02/03/business/americans-closest...


In Hard Economy for All Ages, Older Isn’t Better ... It’s Brutal

By CATHERINE RAMPELL
New York Times, February 2, 2013

...

Americans in their 50s and early 60s — those near retirement age who do not yet have access to Medicare and Social Security — have lost the most earnings power of any age group, with their household incomes 10 percent below what they made when the recovery began three years ago...

Their retirement savings and home values fell sharply at the worst possible time: just before they needed to cash out. They are supporting both aged parents and unemployed young-adult children, earning them the inauspicious nickname “Generation Squeeze.” ...

...people who lost their jobs in the few years before becoming eligible for Social Security lost up to three years from their life expectancy, largely because they no longer had access to affordable health care. ...

Over the last year, the average duration of unemployment for older people was 53 weeks...

In a survey by the center of older workers who were laid off during the recession, just one in six had found another job, and half of that group had accepted pay cuts. ...
[end quote]

As the baby boomers age, the employment level in the 55+ age group has skyrocketed. Boomers who were born just after World War 2 (1945) reached age 55 in 2000.

http://research.stlouisfed.org/fred2/series/LNS12024230
http://en.wikipedia.org/wiki/Baby_boomer

The unemployment level jumped during the recession and has not dropped much.

http://research.stlouisfed.org/fred2/series/LNS13024230

The Unemployment Rate - 55 years and over is lower than the rest of the population, but this only includes those who are actively looking for a job. The share of older people applying for Social Security early spiked during the recession as people sought whatever income they could find. More than one in eight people in their late 50s is now on some form of federal disability insurance program. Most of these do not participate in the labor force so they are not counted as unemployed.

http://research.stlouisfed.org/fred2/series/LNU01376940
http://research.stlouisfed.org/fred2/series/LNU01376955

http://research.stlouisfed.org/fred2/series/LNS14024230

There is a window of danger between age 55 and 65. Before the recession, most pundits considered these to be the maximum earning years. For those who successfully continue their careers, that's probably still true.

However, the recession has been brutal to many who lost their jobs. Too old for retraining, too young for Medicare, hard to find a job with benefits but facing very high health insurance costs. This is a dangerous, potentially devastating situation.

The Macroeconomic impact is reduced demand in the age cohort that should have provided the highest demand, inhibiting economic recovery.

Wendy
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