A Closer Look, Academic Literature

Us Older Workers Increasing Participation Rate – Why then aging is decreasing the overall rate ?

A frequent question is: “I’ve heard the participation rate for older workers is increasing, yet you say one of the reasons the overall participation rate has fallen is because people are retiring. Is this a contradiction?”

Answer: This isn’t a contradiction. When we talk about an increasing participation rate for older workers, we are referring to people in a certain age group. As an example, for people in the “60 to 64” age group, the participation rate has increased over the last ten years from 51.1% in April 2004 to 55.7% in April 2014 (see table at bottom for changes in all 5 year age groups over the last 10 years).

However, when we talk about the overall participation rate, we also need to know how many people are in a particular age group at a given time. As an example, currently there is a large cohort that has recently moved into the “60 to 69” age group. To calculate the overall participation rate we need to multiple the participation rate for each age group by the number of people in the age group.

Capture d’écran 2014-05-05 à 09.05.59

Chosen excerpts by Job Market Monitor. Read the whole story at Calculated Risk: Participation Rate: Trends and Cohorts.

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