Older Workers in Physical Jobs Face Elevated Retirement Insecurity

Physically demanding jobs and involuntary retirement worsen retirement insecurity, according to new research.   

Older workers employed in physically demanding jobs may not be able to delay their retirement to accumulate sufficient savings, a new report shows.

Workers ages 55 to 64 in physical jobs are at increased risk of involuntary retirement and poverty at older ages, according to research by the New School Schwartz Center for Economic Policy Analysis.

The retirement research paper—The Status of Older Workers—finds most workers who retire before age 65 do so involuntarily.

“Many people think of retirement as a worker decision—something that workers have control over—but this is not always the case,” explained Jessica Forden, Retirement Equity Lab research associate at the Schwartz Center for Economic Analysis. “Over half of workers aged 55 to 64 are being pushed out.”

She added, “older workers who retire earlier than planned can suffer serious financial impacts from being less prepared for retirement than they anticipated.”

Prevalent physically demanding positions for men include delivery work, truck driving, janitorial work and cleaning services; and for women, personal care, nursing and childcare, Forden added during a briefing on the paper’s results.

Black and Hispanic workers are particularly at risk, the paper finds. Using data from the RAND Health and Retirement Study from 2018, the researchers found that among men in demanding jobs, 29.5% are White, 48.2% Black, and 47.1% Hispanic; and for women, 25.6% are White, 41.4% Black and 43.1% Hispanic. Hispanic refers to Hispanic of any race while White and Black refer to non-Hispanic White and non-Hispanic Black people.

In the RAND study, workers were considered in a physically demanding job if they answered that their job requires “lots of physical effort,” “all,” or “most” of the time, according to information in the Schwartz Center report. The sample includes full- and part-time workers ages 55 to 64 participating in the HRS survey. The HRS only includes individuals over age 50.

The research found differences in the race and ethnicity of the workers who were forced to retire before age 65. Within the group who retired involuntarily, 51.6% were White, 60.8% Black and 60.2% Hispanic.

Black and Hispanic workers face elevated risks of living in poverty as they age, the paper shows. 

The New School research paper shows Black and Hispanic workers, who are more likely to work in physically demanding jobs, face increased in poverty as they age above that experienced by White workers. The increase in poverty rates between age groups 55-64 and above 65 in 2020 was 3.6% for Hispanic workers, 2.4% for Black workers and 0.3% for White workers, the research shows.

Workers in physical jobs have a dilemma, Forden explained. 

“Many workers are in caught in a difficult circumstance from which there is no escape: they may need to work until [an] older age to support themselves and prepare for retirement but the jobs that are available to them are the very same jobs that may push them out of the workforce earlier than anticipated,” Forden said.

Data from the Bureau of Labor Statistics shows 65% of U.S. workers expect they will have to work past the Social Security retirement age—66 to 67—to have enough money to retire.

Because of physically demanding work, many workers will also be forced to retire because of health issues, the paper showed.

“We are concerned about how working in physically demanding jobs affects a person’s ability to work longer, not necessarily because we want older workers to work longer but because it’s often a solution that is presented as the answer to longer life,” Forden added.

A 2021 study from the University of Michigan Retirement and Disability Research Center, showed increased physical demands on the job were associated with a 10% greater probability of being retired.

Additional contributors to the research paper were Siavash Radpour, Retirement Equity Lab associate research director, at the New School; Eva Conway, associate director, at the Schwartz Center for Economic Policy Analysis; Christopher Cook, resident writer at the New School; and Teresa Ghilarducci, professor of economics and policy analysis at the New School for Social Research.  

Data for the research paper is gathered for the upcoming Older Workers and Retirement Chartbook—a joint project of the New School Schwartz Center for Economic Policy Analysis with the Economic Policy Institute. Data for the research paper is from the Bureau of Labor Statistics, Census Bureau, Economic Policy Institute and Schwartz Center for Economic Policy Analysis, among others.