The Bureau of Labor Statistics (BLS) today reported a 3.2% unemployment rate for workers age 55 and older in July, no change from June. While the low unemployment rate may indicate a healthy labor market for older workers, it doesn’t tell us about job quality.
Only 76% of older workers obtain health insurance through their or their spouse’s job. The remaining 24% fall into three groups; those who purchase private health insurance, often at higher prices or with less coverage and higher deductibles than employer coverage, those eligible for means-tested Medicaid, and those who remain uninsured, typically because they earn too much to qualify for Medicaid but too little to qualify for private health insurance.
High insurance premiums and out-of-pocket costs reduce the amount workers can afford to save for retirement, while the uninsured or underinsured risk catastrophic medical costs that can rapidly deplete their retirement savings.
Access to both health coverage and retirement plans protects older workers’ ability to save for retirement. Policymakers should strengthen the Affordable Care Act and provide a path to a secure retirement by expanding Social Security and implementing Guaranteed Retirement Accounts (GRAs). GRAs are individual accounts on top of Social Security that require contributions from employees, employers, and government throughout a worker’s career.
This was originally published by SCEPA. SCEPA’s Retirement Equity Lab (ReLab), led by economist and retirement expert Teresa Ghilarducci, researches the retirement crisis that exposes millions of American workers to downward mobility in retirement.
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