Baby Boomers: What It Means for Employers

What it means in practice

Baby Boomers, often shortened to boomers, is a generational label, not a legal category. The Census Bureau describes the generation as born after World War II, from 1946 to 1964. Pew Research Center notes that the boomers are the only generation officially designated by the Census Bureau, based on the surge in births in 1946 and the significant decline in birthrates after 1964, a span of 19 years. For later generations, Pew says, "generational cutoff points aren't an exact science," and sources differ: the same 2019 Census story describes millennials as born from 1982 to 2000, while Pew uses 1981 to 1996. See the related entries on Generation X, millennials and Generation Z. The employment rules described below turn on a person's age or birth date, never on a generational label.

Size and aging. In December 2019 the Census Bureau estimated the generation at about 73 million, said about 10,000 a day had crossed age 65 since 2010, and stated that by 2030 all boomers will be at least 65. In an April 9, 2026 story on the age structure of the population, the Bureau pointed to a bump in the 2025 population pyramid at ages 61 to 79, a group that includes those born from 1946 through 1964; it gave a total fertility rate of 3.77 births per woman at the peak of the baby boom in 1957, compared with 1.63 in 2024. The Vintage 2025 population estimates (released June 25, 2026) show 64,617,088 people age 65 and older on July 1, 2025, up 16.2% from 55,628,091 on April 1, 2020, while the population ages 45 to 64 fell 3.2% to 81,324,500. A year earlier, the Vintage 2024 release reported that the 65-and-older share of the population rose from 12.4% in 2004 to 18.0% in 2024.

How many are still working. The Bureau of Labor Statistics measures work by age group, not by generation. In its Current Population Survey annual averages for 2025 (Table 3), labor force participation was 75.0% at ages 55 to 59, 58.7% at 60 to 64, 33.3% at 65 to 69, 18.8% at 70 to 74 and 8.5% at 75 and older, against 62.4% for everyone 16 and older. About 11.4 million people 65 and older were employed (11,374,000), and their unemployment rate was 3.3%, compared with 4.3% overall. BLS notes that the 2025 figures are 11-month averages that exclude October, because October 2025 data were not collected during the federal government shutdown, so they are not strictly comparable with other years.

What BLS projects. The BLS employment projections Table 3.3 covers 2005, 2015, 2025 and a projected 2035, and its footnote places boomers at ages 61 to 79 in 2025 and 71 to 89 in 2035. Participation for people 55 and older was 38.1% in 2025 and is projected at 36.7% in 2035, even though the projected rate rises within each older age group: from 66.6% to 69.5% at ages 55 to 64, from 26.7% to 29.1% at 65 to 74, and from 8.5% to 10.1% at 75 and older. The overall rate is projected to fall from 62.4% to 61.1%.

Age discrimination law. Every boomer is past 40, the age at which the Age Discrimination in Employment Act (ADEA) begins to protect applicants and employees. The EEOC says the law covers employers with 20 or more employees and forbids treating someone less favorably because of age. It is not illegal to favor an older worker over a younger one, even if both are 40 or older, and a policy that applies to everyone can still be illegal if it has a negative impact on workers 40 and older and is not based on a reasonable factor other than age. Under 29 CFR 1625.9, the 1986 amendments removed the former age-70 limit, so unless a specific exemption applies an employer can no longer force retirement because of age; a plan may still let individuals elect early retirement at their own option.

Severance and exit-incentive waivers. The Older Workers Benefit Protection Act added waiver rules to the ADEA. Under 29 CFR 1625.22, a release of age claims is valid only if it is knowing and voluntary. At a minimum the whole agreement must be in writing in plain language, refer to the ADEA by name, not waive claims arising after signing, give consideration beyond anything the person is already entitled to, and advise the person in writing to consult an attorney. The person must get at least 21 days to consider it, or 45 days when the waiver is part of an exit incentive or other termination program offered to a group, and at least 7 days after signing to revoke. The 21 or 45 days run from the employer's final offer, material changes restart the clock, and the 7-day revocation period cannot be shortened. In a group program, the EEOC explains that the employer must also disclose the decisional unit and the job titles and ages of the employees who were and were not selected.

Health coverage and Medicare Secondary Payer rules. Medicare's working-aged rules apply to an employer with 20 or more employees for each working day in each of 20 or more calendar weeks in the current or preceding calendar year (42 CFR 411.170). For those employers, the group health plan pays first and Medicare second for a person 65 or older, or an aged spouse, covered by virtue of current employment status (42 CFR 411.172; CMS booklet MLN006903, July 2025). The plan must give employees and spouses 65 and older the same benefits under the same conditions as those under 65 (42 CFR 411.102). Examples of prohibited "taking into account" include offering coverage secondary to Medicare, terminating coverage because of Medicare entitlement, and charging higher premiums (42 CFR 411.108). An employer may not offer financial or other incentives not to enroll in a primary plan, and a violation carries an inflation-adjusted civil money penalty (42 CFR 411.103). An employee may refuse the plan; Medicare then pays first and the plan may not offer coverage complementary to Medicare (42 CFR 411.172(c)). Under 20 employees, Medicare generally pays first, and retiree coverage pays after Medicare (Medicare.gov publication 11546, January 2026).

Medicare enrollment timing. Medicare.gov describes an initial enrollment period of 7 months, starting 3 months before the month a person turns 65 and ending 3 months after it. A person who delays enrollment because of group health coverage from current employment has a special enrollment period that ends 8 months after the coverage or the employment ends, whichever happens first, and COBRA does not count as group health plan coverage for this purpose. On the retiree side, the EEOC exempts from the ADEA retiree health benefits that are altered, reduced or eliminated when the retiree becomes eligible for Medicare, an exemption it says is narrowly construed (29 CFR 1625.32).

Social Security full retirement age. The Social Security Act sets early retirement age at 62 and full retirement age by year of birth (42 U.S.C. 416(l)). It is 66 for people born from 1943 through 1954, rises by two months per birth year for 1955 through 1959 (66 and 2 months for 1955 up to 66 and 10 months for 1959), and is 67 for people born in 1960 or later. That puts every boomer born from 1960 through 1964 at a full retirement age of 67.

The earnings test for working beneficiaries. A boomer can collect Social Security and keep working. Under full retirement age, SSA withholds benefits when earnings pass an annual exempt amount. According to the SSA notice for 2026, the lower amount is $24,480 ($2,040 a month), with $1 withheld for every $2 above it; in the year a person reaches full retirement age, the higher amount of $65,160 ($5,430 a month) applies to earnings in the months before that month, with $1 withheld for every $3 above it. The SSA notice for 2027, published October 26, 2026, sets them at $25,560 ($2,130 a month) and $67,920 ($5,660 a month). Example: a beneficiary born in 1963 who earns $34,480 in 2026 is $10,000 over the lower amount, so $5,000 in benefits is withheld. Example: a beneficiary born in 1960 who reaches 67 in July 2027 and earns $72,000 from January through June is $4,080 over $67,920, so $1,360 is withheld.

Required minimum distributions. The IRS says required minimum distributions generally start at age 73. The final regulation at 26 CFR 1.401(a)(9)-2 sets the applicable age by birth date: 70 1/2 for those born before July 1, 1949, 72 for those born from July 1, 1949 through 1950, 73 for those born from 1951 through 1958, and 75 for those born in 1960 or later; the paragraph for 1959 births is reserved. A 401(k) or other defined contribution plan may let a participant who is not a 5% owner delay the first distribution until April 1 after the later of the year they reach the applicable age or the year they retire; IRA owners cannot delay for employment. Example: an IRA owner and plan participant born in 1955 reaches 73 in 2028; the first IRA distribution is due by April 1, 2029, but if the plan allows delay and the employee retires in 2030, the first plan distribution is due by April 1, 2031. A missed distribution can trigger a 25% excise tax, or 10% if corrected within 2 years. The IRS FAQ adds that an employer must continue contributions for an employee who is receiving distributions and let the employee keep making salary deferrals in a plan that permits them.

Catch-up contributions. Per the IRS catch-up page and its 2026 limits release, the 2026 elective deferral limit for 401(k), 403(b), governmental 457 plans and the Thrift Savings Plan is $24,500, and participants 50 and older may add up to $8,000, for $32,500. Employees who turn 60, 61, 62 or 63 during the year may instead add up to $11,250. Among boomers that means only those born in 1963 or 1964 for 2026, and only those born in 1964 for 2027. SIMPLE plans allow $4,000 ($5,250 at 60 to 63) and IRAs $1,100. Beginning in 2026, in plans with Roth features that offer catch-ups, participants whose prior-year wages from the plan sponsor exceeded $150,000 must make catch-up contributions on a Roth basis.

Phased retirement. Phased retirement generally means reducing hours while beginning to draw retirement income; no single federal rule defines it for private employers. The federal government's program, described by OPM and governed by 5 CFR part 848, lets a retirement-eligible employee who has worked full time for the prior 3 years move to a half-time schedule while drawing a partial annuity, with agency approval and a written agreement, and requires at least 20% of working hours to be spent mentoring unless waived. For private pension plans, the tax code allows distributions to an employee who has reached 59 1/2 and has not separated from employment (26 U.S.C. 401(a)(36)). The mentoring requirement shows how phased retirement can connect to a succession plan.

Where states differ. State age discrimination laws can reach further than the ADEA. Two examples from official state sources: New York's Human Rights Law (Executive Law 296(3-a)) protects individuals 18 or older from age discrimination and bars termination or retirement on the basis of age except in listed cases, and the New York State Division of Human Rights says the law covers every employer regardless of size. The California Civil Rights Department lists age 40 and over as protected, applies to employers of 5 or more employees, and generally allows three years to file a complaint.

FAQ: Is "Baby Boomer" a protected category? Not as a label. Federal protection depends on age: the ADEA covers people 40 and older, which today includes every boomer.

FAQ: Can an employer require retirement at 65 or 70? Generally no. Since the 1986 amendments an employer cannot force retirement because of age unless a specific exemption applies (29 CFR 1625.9).

FAQ: Does an employee who enrolls in Medicare have to leave the group health plan? No. At an employer with 20 or more employees, the plan may not take Medicare entitlement into account and remains primary for a worker 65 or older covered through current employment (42 CFR 411.102 and 411.172).

FAQ: Does the Social Security earnings test apply after full retirement age? No. SSA's notice describes withholding only for beneficiaries under full retirement age, with the higher exempt amount in the year that age is reached.

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