Currently, nearly one in four workers is over the age of 55 — a demographic shift major implications for benefit strategy and workforce planning. Many employees are also dealing with caretaking for their elderly parents.
Key data points on an aging workforce
- Labor force share (age 55+): Increased from 12% in 1990 to 24% in 2023.
- Workforce participation (age 65+): Reached 20% in 2022 — the highest on record.
- Delayed retirement: Economic factors and longer lifespans are pushing retirement ages higher. The average medical retirement age has gone from 62 to 65 in the past ten years.
Impact on medical and pharmacy cost trends
- Higher healthcare utilization: Older workers have higher rates of chronic conditions such as diabetes, hypertension, arthritis and cardiovascular disease. This increases demand for medical services and specialist care.
- Escalating pharmacy spend: Utilization of maintenance medications, biologics and high-cost therapies — including those for osteoporosis and inflammatory conditions — continues to rise.
- Productivity and absenteeism: Increased medical appointments, prolonged recovery periods and functional limitations contribute to higher absenteeism and potential productivity losses.
