Introduction
Knowing the trend of retirement in the noninstitutionalized population helps in evaluating macroeconomic and labor market conditions and various tax, retirement, and health policies in the public and private sectors. This type of analysis is typically done by examining labor force participation rates from the US Bureau of Labor Statistics, based on the Current Population Survey (CPS).1 Rates are often separated by age, gender, education, and other factors. It is perhaps simpler and more intuitive, though, to take another approach: calculating the average retirement age, based on the same data.
I define the “average retirement age” in a particular year as the age at which 50 percent of the relevant population is out of the labor force and not working.2 I separate different populations such that I calculate the average retirement age for everyone, men and women separately, and three different educational levels—high school education or less, some college, and college degree or more.
I also calculate the ages at which 25 and 75 percent of these populations are still in the labor force, to indicate the range of experience over time. These measures for retirement age, particularly at the 75th percentile, may be regarded as a somewhat low estimate of labor market activity at those ages because they include some people whose attachment to the labor force is minimal more permanently. These people include, for example, those who are disabled or are taking care of children, grandchildren, or older relatives.
The data shown in this report give the 12-month rolling average retirement age for each month between January 1990 and August 2021. The labels “25th Percentile,” “50th Percentile,” and “75th Percentile” in Figures 1–6 refer to the age at which labor force participation falls below 25, 50, and 75 percent, respectively. If the participation rate drops below a boundary more than once due to small increases in the participation rate with age, the oldest age of the drop below the specific rate is taken. The shaded areas in the figures indicate recessions according to National Bureau of Economic Research dating.
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