Age, AI, and Wealth—Fewer Older Americans Are Working Today

Immigration has dominated the conversation around today’s labor market, but another force reshaping employment conditions is the steady exit of older Americans from the workforce.

The share of Americans aged 55 and older who are working sits slightly above 37 percent, according to the most recent data from the Bureau of Labor Statistics. This is the lowest level since April 2005 and has been steadily declining since the COVID-19 pandemic.

Age is playing a central role in the downward trend, as the youngest Baby Boomers are 62. With millions of Americans turning 65 this year, the demographic shift will persist, experts say.

But rising home values and a surging stock market have also supported older workers’ decision to step aside from professional life and ease into a game of pickleball and sleeping in.

The Baby Boomer generation, which accounts for about a quarter of the U.S. population, holds about $85 trillion in assets, according to Federal Reserve data.

“As the oldest Baby Boomers turn 80 this year, many people are taking stock of how this generation has impacted American life,” Richard Fry, senior researcher at Pew Research Center, said in a February blog post.

“One fact is clear: They’ve accumulated more wealth ($85 trillion by some accounts) than previous generations of older Americans.”

Nearly a third of the nation’s total wealth is owned by individuals more than 70 years old, says Torsten Slok, chief economist at Apollo.

Additionally, financial services firm Empower estimates that older Americans enjoy an average net worth of approximately $1.65 million.

With the post-crisis boom filtering through asset holders, many older workers may have been incentivized to submit their resignation letters and wave goodbye to the daily grind.

However, with historic changes to immigration policy, the labor market may take time to adjust.

Immigration has offset the exit of older workers from the labor force, accounting for about half of annual labor force growth since 1995, according to economists at the Kansas City Federal Reserve. Immigration policy reforms—and lower birth rates—have altered the composition of the workforce.

“By shifting the composition of the labor force to those with lower participation, an aging population has reduced the overall labor force participation rate,” they wrote.

The labor force participation rate in March was 61.9 percent—the lowest since November 2021.

Rise of the Machines

The U.S. median age has climbed from 32.9 in 1990 to 39.1 today. This demographic shift has reduced the share of the population in prime age (25 to 54) and expanded the share aged 55 and older.

This may prove challenging for employers seeking to fill the more than 6 million job vacancies.

It might also risk economic growth prospects, forcing the country to focus on productivity gains through greater investment in technology.

Since the launch of ChatGPT a few years ago, U.S. companies have been investing more in artificial intelligence (AI), though this investment has largely been concentrated among larger companies.

A new Gallup poll found that half of employed workers use AI in their roles a few times a year.

Research by the Federal Reserve Bank of New York suggests that AI use in the workplace has been concentrated among high-income, highly educated, and full-time workers.

Economists have been optimistic that a productivity boom comparable to the late 1990s is on the horizon. Some data suggest there have been early signs of this expectation coming to fruition.

While nonfarm business labor productivity decelerated to 1.8 percent in the fourth quarter, it rose to 5.2 percent in the third quarter and 4.2 percent in the second quarter.

“Industry data suggest the pickup is not yet broad-based: A small set of industries accounts for most gains,” Kansas City Fed economists said in a February 2026 paper.

“While higher AI adoption is associated with faster productivity growth across industries, it explains little of the shift in aggregate contributions, suggesting AI adoption is still spreading.”

But embracing AI and new technologies could further push seniors out of the workforce—or make the late Generation X and early Baby Boomers hesitant to reenter the job market.

An American Association of Retired Persons survey from September 2025 found that many older adults are reluctant to adopt AI, and 42 percent say they are beginners.

But most older respondents are confident that they could learn and adapt to new technologies.