Are older workers holding back the next generation?

Executive Summary

The composition of the U.S. workforce is changing dramatically. People are living longer and healthier lives, allowing them to work beyond what was once considered a typical retirement age. At the same time, younger workers are trying to gain a foothold in a job market that increasingly values both experience and credentialing, even for entry-level positions that may not have required a degree in the past. This confluence of trends raises several issues, including whether Baby Boomers are displacing Millennials in the workforce or holding them back from advancement, the impact of underemployment on Millennials, the cost to employers of an aging workforce and what will happen once Boomers begin to retire in greater numbers.

Among the key takeaways:

  • Baby Boomers represent one-quarter of the labor force, and the average retirement age is higher than it was two decades ago.

  • Many Millennials are overskilled or overeducated for the jobs they are taking, which can have long-lasting effects on future employment prospects and earning potential.

  • Delayed retirements have both positive and negative effects for employers. Although they are able to retain experienced staff, they incur increased costs to maintain these older workers and must plan for the impending brain drain when they do retire.

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Resources for Further Study



Burke, Ronald J., Cary L. Cooper and Alexander-Stamatios G. Antoniou, “The Multi-Generational and Aging Workforce: Challenges and Opportunities,” Edward Elgar Publishing, 2015. Experts discuss the changing American labor force, its challenges, opportunities and how to work and manage within it.

Taylor, Paul, “The Next America: Boomers, Millennials, and the Looming Generational Showdown,” PublicAffairs, 2016. A Pew Research Center senior fellow describes how the United States is shifting – socially, politically and demographically – due to current generational conflicts.


Carmichael, Sarah Green, “Millennials Are Actually Workaholics, According to Research,” Harvard Business Review, August 17, 2016, A Harvard Business Review editor looks at studies on Millennial attitudes toward vacation and time off.

Fry, Richard, “Millennials are the largest generation in the U.S. labor force,” Pew Research Center, April 11, 2018, A researcher parses the generational data on the U.S. labor force.

Lutz, Jessica, “The Underemployment Phenomenon No One Is Talking About,” Forbes, July 21, 2017, A writer explores the disparity in retirement savings between high- and low-income earners and the impact of rising life expectancy on retirement funds.

Weise, Michelle, “First jobs matter: Avoiding the underemployment trap,” The Washington Post, June 1, 2018, The chief innovation officer at the Strada Institute for the Future of Work explains the negative long-term impact of starting a career underemployed.

Reports and Studies

“America’s Aging Workforce: Opportunities and Challenges,” U.S. Senate Special Committee on Aging, December 2017, A Senate committee explores the challenges faced by the growing number of older Americans in the workforce.

“The Permanent Detour: Underemployment’s Long-Term Effects on the Careers of College Grads,” Strada Institute for the Future of Work and Burning Glass Technologies, May 2018, A report looks at the impact of underemployment on college graduates, including their long-term earnings and job prospects.

“Why Employers Should Care About the Cost of Delayed Retirements,” Prudential Financial, 2017, Researchers for the insurer estimate the high cost to employers when older workers choose to delay retirement.

Blau, David M., and Bruce A. Weinberg, “Why the US science and engineering workforce is aging rapidly,” Proceedings of the National Academy of Sciences, April 11, 2017, Two scholars report on concerns surrounding an aging scientific workforce.

Carnevale, Anthony P., Andrew R. Hanson and Artem Gulish, “Failure to Launch: Structural Shift and the New Lost Generation,” Georgetown University Center on Education and the Workforce, Sept. 30, 2013, Researchers explore how shifts in the economy forced younger workers to delay their careers, but conclude that this delay is not being caused by Boomers remaining in the labor force longer.

Copeland, Craig, “Labor Force Participation Rates by Age and Gender and the Age and Gender Composition of the U.S. Civilian Labor Force and Adult Population,” Employee Benefit Research Institute, May 8, 2018, A review of Census Bureau workforce statistics and their possible implications.

Sawyer, Bradley, and Nolan Sroczynski, “How do health expenditures vary across the population?” Kaiser Family Foundation, Dec. 1, 2017, Researchers explore the differences in spending on health care by demographics and overall health.

The Next Step


Hoffower, Hillary, “The ‘lost generation’ of millennials born in the 1980s may never be as rich as their parents,” Business Insider, May 22, 2018, Millennials who entered the job market during and after the recession likely have found themselves still struggling to accumulate wealth several years later, according to a report by the Federal Reserve Bank of St. Louis.

Sherman, Erik, “Underemployment Takes An Outsized Toll On The Economy, According To A New Study,” Forbes, Sept. 25, 2018, Underemployment could be the root cause of low wage growth, in the United Kingdom as well as in the United States, according to a recent study by the U.S. National Bureau of Economic Research.

Smith, Noah, “Why Millennials Are Sour on the Economy,” Bloomberg, Sept. 28, 2018, Chronic underemployment has left Millennials with a pervasive feeling of disappointment, says a Bloomberg columnist.

Work benefits

“The doctor is out: Many millennials choose convenient drop-in clinics over traditional doctor’s offices,” ABC News, Oct. 9, 2018, Millennials are much more likely than Americans ages 50 to 64 to use alternative health care services, with one-third of Millennials saying they do not go to a primary care physician, according to a 2017 Employee Benefit Research Institute survey.

Fox, Ashley M., “Why Millennials Hate ‘Retirement,’ And What They Actually Need To Do Financially,’” Forbes, Sept. 21, 2018, Millennials thinking ahead to retirement should look into company options besides pensions, develop alternative income streams and cultivate independent investments, advises a former Wall Street analyst.

Pandey, Erica, “The future of student debt: How employers might help,” Axios, Oct. 11, 2018, Some employers are responding to the student debt crisis facing Millennials by helping them pay off their student loans.


601 E St., N.W., Washington, DC 20049
An organization focused on providing information and advocating for those ages 50 and older to help them live well in retirement.

Brookings Institution
1775 Massachusetts Ave., N.W., Washington, DC 20036
Public policy institute conducting research on domestic and global issues.

Center for Human Resources, University of Pennsylvania Wharton
204 Steinberg Hall/Dietrich Hall, 3620 Locust Walk, Philadelphia, PA 19104-6302
Research hub for issues affecting human resources practitioners and vendors.

Employee Benefit Research Institute
1100 13th St., N.W., Suite 878, Washington, DC 20005
Research organization working to enhance employee benefit programs and the public policy that supports them.

Georgetown Center on Education and the Workforce
3300 Whitehaven St., N.W., Suite 3200, Washington, DC 20007
Research institute studying the intersection of education, career readiness and workforce needs.

National Bureau of Economic Research
1050 Massachusetts Ave., Cambridge, MA 02138
Nonpartisan organization conducting economic research for businesses, academics and policymakers.

Pew Research Center
1615 L St., N.W., Suite 800, Washington, DC 20036
Research institute seeking to provide evidence-based analysis on national and international issues.

Society for Human Resource Management
1800 Duke St., #100, Alexandria, VA 22314
Organization working to advance the human resources profession through education, advocacy and thought leadership.

Strada Education Network
9998 Crosspoint Blvd., Suite 400, Indianapolis, IN 46256
Nonprofit organization dedicated to solving challenges in transitioning from college to career.

U.S. Travel Association – Project: Time Off
1100 New York Ave., N.W., Suite 450, Washington, DC 20005
Organization focused on promoting the idea of using earned time off and increasing travel within the United States to benefit the economy, jobs, and employee well-being.

DOI: 10.1177/237455680431.n1