According to Fed data, it took until late 2010 for people aged 55 to 69 to reach late 2007 wealth. This time a blow from early 2020 to June 2020 was fully recovered. Financial wealth for this age group is now about 20 percent above where it was on its way into the pandemic, despite recent market weakness.
And while inflation erodes purchasing power, Social Security payments are price-adjusted, taking some of the sting out of it.
The Liebermans in Pennsylvania, for example, could return to working part-time if necessary — but they don’t expect to have to.
“I think we’d be fine if inflation didn’t get really ballistic,” Mr. Lieberman said.
While retirements could help keep workers in short supply across America, other factors could strengthen the workforce. Immigration, for example, is recovering.
And some data paint a more optimistic picture of the labor force: Monthly payroll figures from the Labor Department, based on a separate survey from demographic statistics, show that companies have continued to create jobs quickly, despite lamentations of labor shortages.
“If you listen to Jerome Powell talk about the labor supply, he seems reconciled to the idea that there’s nothing left,” said Nick Bunker, economic research director for North America at Indeed Hiring Lab. “There are more workers out there who can be hired and want to be hired.”
But central bankers need to gauge what’s next as best they can, and so far they have found a labor supply surge large enough to cool the hot labor market is unlikely.
“In the short term, moderation in labor demand growth will be required to restore balance to the labor market,” Mr Powell said last month.
Comments are closed.