Older Workers May Be Retiring Early Because of the Coronavirus


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Many older workers may be choosing early retirement rather than face the risk of becoming infected and getting seriously ill during the COVID-19 crisis, new economic research suggests.

In a paper recently published by the National Bureau of Economic Research, University of Texas at Austin economist Olivier Coibion and colleagues Yuriy Gorodnichenko of the University of California, Berkeley, and Michael Weber of the University of Chicago report a 7 percent drop between January and April in labor force participation (the measure of how many people either have jobs or are seeking them).

That decline was more than twice the cumulative drop in the eight years from 2008 to 2016, according to their figures.

Among Americans who aren’t in the labor force, the researchers found what they call a “large” increase in those who identify themselves as retired, rising from 53 to 60 percent of the category of people who are not employed.

The researchers think this suggests a wave of retirements that were earlier than planned. “With the high sensitivity of seniors to the COVID-19 virus, this may reflect in part a decision to either leave employment earlier than planned due to higher risks of working or a choice to not look for new employment,” they wrote.

But it’s not clear whether this is a permanent shift or whether older workers eventually will return to the workforce once the coronavirus pandemic subsides.

One of the bright spots of the 2020 real estate market is the growth in equity homeowners are experiencing across the country. According to the recently released Homeowner Equity Insights Report from CoreLogic, in nearly every state there was a year-over-year first-quarter equity increase, averaging out to a 6.5% overall gain. That’s a huge win for homeowners, especially for those looking to sell their houses and make a move this summer. Having equity to re-invest in your next home is a major force that can make moving a reality, especially while buyers are expressing such a high demand for homes to purchase. Equity paired with early retirement is putting many older workers in a unique situation. Call the Stovall Team today if you feel it may be time to make your move. 714.343.9294


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