When did early retirement begin? According to a new brief by Alicia H. Munnell, director of the Center for Retirement Research at Boston College, it began a decade or so after the Civil War. "Beginning around 1880, the percentage of the older male population at work began to decline sharply," she says. Behind the decline were old-age pensions for Civil War veterans.
"The next big decline in the work rates of older men occurred after World War II," she writes, primarily because Social Security benefits began in 1940. Generous employer pensions followed, driven in part by powerful unions. Medicare was introduced in 1965, and Social Security was indexed to inflation in the early 1970s. The rest is history.
A short history. The trend toward early retirement lasted only until the mid-1980s. That's when the age of retirement reversed direction for reasons she details in the brief. The average retirement age among men (meaning, the age at which their labor force participation rate drops below 50 percent) has increased from 62 to 64 over the past two decades.
Source: Center for Retirement Research at Boston College, What is the Average Retirement Age?
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