There's an article in the NY times Economix blog warning us not to get too over excited about inflation. That at 1.3% it's historically low. Though one could argue the things that inflation does not consider are what's actually important for the people that it most directly affects. Much like federal poverty levels tend to be focused around food as that used to be the most expensive monthly cost to families whereas now housing takes up a huge chunk.
As I was reading the article and thinking about the loose connections to the great depression I wondered whether the poor unemployment numbers were causing fewer people to retire. We've been warned for years about the impending mass retirement of the baby boomers and how that will give us a huge technically educated labor shortage. I've talked about that myth before.
As you can see by the chart above, those 55 and older have been hit hard (as hard magnitude-wise as any other age group) by unemployment. BLS doesn't specifically track retirement, but it does track those "not in the labor force" and "not looking for a job". This was roughly 60% of the over 55 population in 2006 and 59.5% of the over 55 population in 2008. Averaged between 2006 and 2008, the over 55 population grew about 2.7% a year. So you might expect to see similar growth in how many are not in the labor force by choice. Instead from 2006 to 2010 the growth of this possible "retired" population increased 1.4%, 1.88%, 1.06%, 1.42% and 2.20% respectively.
It could be the peak in 2007 was due to the brutality of the recession beginning and a lot of people choosing to drop out voluntarily. Maybe the high number in 2010 can be attributed to people who had wanted to retire sooner but couldn't now being able to once the stock market gains started improving. At any rate, this possible "retired" population is increasing much more slowly than the actual population itself. The question is, as the economy starts to even out, will we see more "older" people trying to return to work or will we see more of these people finally being able to retire? If the stock market finally allows them to drop out of the labor force, will inflation let them have any real security by then?