Employers want their retirees to return to the workforce

Retirement-aged employees were the first to go when COVID began, but as the labor market struggles to bounce back, employers are turning to this same group to fill much-needed positions.

Twenty percent of retirees say past employers have asked them to return because of the labor shortage, according to a recent study conducted by job search platform Resume Builder. And while 41% said they would consider going back to their former position, 59% would choose to seek employment elsewhere.

Employers may have acted too quickly in letting these employees go, according to Stacie Haller, one of Resume Builder’s career and staffing experts. Now that there are more jobs available than people seeking employment, retirees have realized that they may want a shot at those job opportunities, too.

“When the first rounds of layoffs and furloughs happened during COVID, it was those closest to retirement age [that got let go] because companies figured that they were not there for the long run anyway — which was so short-sighted,” she says. “That's why they're going back to these people, because now they can't find employees that would be most valuable to fill that open spot.”

Read more: COVID-19 is forcing more employees into early retirement

During the pandemic, more than two-thirds of retirees said they retired earlier than expected, up significantly from the 50% of employees who left the workforce for early retirement in 2020, according to a survey conducted by Allianz Life. Of those older employees who were pre-emptively laid off, most were concerned about their ability to re-enter the workforce after being laid off during the pandemic, worried that the post-pandemic hiring frenzy would benefit younger workers exclusively.

But instead, the pandemic has turned the tables on employers. A third of employees surveyed by Lincoln Financial Group have willingly quit without having other employment lined up, and 64% said they would switch careers for a less stressful work environment instead of receiving a raise.

This means employers have had to work harder to attract top talent and fill a gaping hole in the labor market — one retirees are more than happy to take advantage of, but on their own terms.

Read more: How to recalibrate your retirement planning during COVID

“Prior to the pandemic, employees in their fifties and older really had no other options,” Haller says. “Maybe they could get a local part-time job somewhere if they wanted, but their options were really limited due to a lot of constraints. Now there's such a need in the workforce that some of the old barriers are getting very soft.”

In fact, inspired by the number of in-demand jobs across multiple sectors, 58% of retirees looking to rejoin the workforce are willing to switch industries in favor of a career they’re more interested in, and 66% said they would also make the switch for a less stressful or demanding job.

Employers should look at the re-entry of retirees in the workforce as more than just a means to solve the labor shortage, according to Haller. It’s the opportunity to finally address the much deeper rooted ageism problem in recruiting. Gone are the days of traditional retirement ages; these returning retirees are not only knowledgeable, but their eagerness to return to the workforce even after being given an out speaks to their drive.

“All of a sudden retirees who were shackled to jobs for years are now in a position where they could do something that they wanted to do their whole life,” she says. “They don't feel that they have no other choice now.”