The median age in the United States has just reached a new high. What Does This Mean for the Workforce? Companies that make changes to accommodate multigenerational workforces will reap long-term benefits.

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 The United States is undergoing an aging population shift, which means we can expect an increase in workplaces that consist of multiple generations working together.

The median age in the United States has just reached a new high. What Does This Mean for the Workforce? Companies that make changes to accommodate multigenerational workforces will reap long-term benefits.
BY SARAH LYNCH , STAFF REPORTER@SARAHDLYNCH


According to a recent report by the U.S. Census Bureau, the median age in the country reached a record high of 38.9 years in 2022, showing a significant increase from 35.3 years in 2000. Around one-third of states now have median ages surpassing 40, and none of the states have witnessed a decline in median age.


During the past 15 years, there has been a substantial decrease in the birthrate in the U.S., while the recent decline in immigration has resulted in fewer working-age adults entering the country. Simultaneously, the number of individuals aged 55 and above who are still part of the workforce has doubled within a span of 20 years, as highlighted in a 2020 report by the National Bureau of Economic Research.

The tightening labor market, which is particularly challenging for small businesses, is further strained by the aging workforce. According to Moody's, around 70 percent of the decline in the labor force participation rate can be attributed to aging workers.


However, there is a trend of people working later in life, as indicated by a Gallup survey showing an increase in the average retirement age from 57 in 1991 to 61 in 2022. Additionally, a recent Paychex survey suggests that some retired Americans have returned to the workforce, and one in six retirees are considering it.


As a result of these demographic changes, many workplaces now comprise multiple generations. Mauro Guillén, dean of the Cambridge Judge Business School and author of "The Perennials: The Megatrends Creating a Postgenerational Society," states that this shift brings both risks and benefits. One potential risk is "intergenerational conflict," while another concern is the rising labor costs associated with an aging workforce, including salaries, health insurance, paid time off, and pension contributions.


However, age-diverse teams also offer advantages. The NBER report emphasizes the knowledge and experience that older workers bring to the table. Guillén suggests that multigenerational workforces can enable "reverse mentoring," where younger employees train older colleagues in areas such as social media or artificial intelligence.


To adapt to these changes, some companies are implementing financial education programs and initiatives supporting multigenerational workforces, such as flexible work arrangements or health savings accounts (HSAs), as outlined in the NBER report.


Companies that proactively embrace and manage these changes will gain a competitive edge, as the rise of multigenerational workplaces is just the beginning, according to Guillén. Kristie Wilder, a demographer at the Census Bureau, predicts a continued slow increase in the median age of the population in the years to come.


Smaller businesses, in particular, can leverage their agility to adapt to new policies and mindsets. With the rising median age in the United States, these businesses may need to adjust sooner than expected.




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