As of the third quarter of 2021, 50.3% of U.S. adults 55 and older said they were out of the labor force due to retirement, according to a Pew Research Center analysis of the most recent official labor force data. In the third quarter of 2019, before the onset of the pandemic, 48.1% of those adults were retired. In regard to specific age groups, in the third quarter of 2021 66.9% of 65- to 74-year-olds were retired, compared with 64.0% in the same quarter of 2019.
The data regarding entrepreneurs tell a different story, however. According to the Kauffman Foundation, the trend in the age of entrepreneurs over the past twenty-five years represents a substantial shift towards more participation of older entrepreneurs: In 1996, 14.8% of entrepreneurs were 55-64 years old and by 2020, 24.5% were 55-64 years old. An article in NextAvenue indicates that Guidant Financial and the Small Business Trends Alliance, in its 2021 Small Business Trends (a survey of over 2,400 current and aspiring small business owners nationwide), report that Boomers account for 41% of small business owners (currently between ages 57 and 75) and Generation X for 46% (41 to 56 years old).
Looking at these data together, one might conclude that a significant portion of the Boomer generation is leaving the traditional workforce -- that is, working for someone else -- and possibly entering the self-employed workplace. Today, self-employment could be defined in a number of different ways. It could be starting a full-time business or a part-time business. It could also be setting up a freelance business in which an individual works on a project or hourly basis. So many of these "gig" businesses fly under the statistical radar that it might be difficult to even know how many older adults are involved in such enterprises.
It may look like the majority of Boomers are retiring, but how many of them are instead just changing the way they look at work? Perhaps a number of them are now viewing work as optional rather than mandatory. Those Boomers who retire from the traditional workforce may be figuring out how to combine part-time work with volunteering and leisure time. They could be drawing Social Security and taking Required Minimum Distributions (RMDs) from retirement funds to live on and working part-time more for satisfaction than for income. If this is the case, as I suspect it is, then many Boomers have indeed fundamentally changed the very nature of retirement. They're going off to work... but in a whole new way.
Image from 1958 trailer for Walt Disney's "Snow White and the Seven Dwarfs." Public domain via Wikimedia Commons.