The American dream of working three or four decades and then retiring to a life of well-earned comfort is no longer an option for a surprisingly large number of workers.

According to a new report from The Conference Board titled, “Trapped on the Worker Treadmill,” people between the ages of 45 and 60 who have experienced a job loss, seen their salary reduced or watched the value of their home decline are “much more likely” to consider delaying retirement. More specifically, The Conference Board states, “of respondents aged 45-60, the percent that plans to delay retirement has gone up 20 percentage points in two years.”

This is despite a much-improved economy – including higher housing prices, an upswing in the stock market and increased hiring.

“It’s disconcerting that the two years in which the U.S. economy seemed to finally, if fitfully, turn the corner also left so many more workers compelled to change their retirement plans late in their careers,” says Gad Levanon, director of macroeconomic research at The Conference Board and a co-author of the report, in a quote on the association’s website. “This may benefit some businesses and industries, by reducing labor shortages and skill gaps as experienced workers stick around. At the same time, their delaying retirement can be a significant obstacle to the many companies seeking to cut costs.”

A major factor contributing to the survey’s findings “is the continued depletion of savings,” according to The Conference Board website. “The U.S. recession officially ended in July 2009 and the stock market has rebounded strongly since then. In 2012, however, 62% of 45- to 60-year-olds reported at least a 20% decline in the value of their financial assets since the start of the crisis — up from 42% in 2010.”

“People are finally realizing that living to 120 (which the actuaries are forecasting) is going to be very, very expensive,” notes Olivia Mitchell, Wharton professor of business economics and public policy. “Accordingly, a few more years of work can provide the degrees of freedom many need to offset declines in housing values and 401(k) account balances. Also, medical care costs are going through the roof, which is enough to make many think twice about leaving jobs with health insurance coverage. And finally, the recent research suggests that working longer makes for healthier lives, which may be quite attractive to many.”

Kent Smetters, Wharton professor of business economics and public policy, agrees. “Probably only about a third of baby boomer households have an adequate amount of saving for retirement anyway,” he says. “Of course, part of the reason might be that many people have been out of the market and have not enjoyed recent stock returns. Another reason might be a general fear of risk. But one reason might simply be that as more people approach retirement, they are finally looking at the numbers and simply realizing that they never saved enough in the first place. Most have not.” 

Related to this, Smetters adds, is that “in the old days of 5% interest rates, people used to think that retiring with a million dollars was adequate, because they could safely get $50,000 per year without dipping into their principal. They now realize that they need a lot more since interest rates are so low.” 

Wharton management professor Matthew Bidwell wonders about one of the report’s numbers. “Hopefully, people who are 45 are not planning to retire imminently, so this is not necessarily a comment on their immediate situation, but rather it is tapping into a broader set of beliefs about how their lives will play out,” he says. “It may reflect a general erosion of trust in the ability of the current set-up, in terms of savings institutions and entitlements, to provide for them as they retire.” 

The report’s findings also raise the issue of whether more and more young people are being kept out of the job market – and delaying their own careers — because older people are hanging on longer. Not necessarily, says Bidwell. “I think economists would argue that people who are delaying retirement are doing so in order to earn, and spend, more money than they otherwise would be able to. That spending money ultimately creates jobs.” 

Adds Mitchell, who is also executive director of The Pension Research Council: “The idea that there is a fixed number of jobs has long been discounted by economists. Rather, the labor market tends to be very flexible, so the prediction is that more older workers will [likely] be absorbed relatively easily. In fact, in countries which encourage earlier retirement ostensibly to ‘make way’ for the younger folks, it proves to be very expensive to pay for all the retirement benefits. [Then] tax rates rise so much that it discourages younger employees from working.” 

Which industries are likely to benefit more than others from this trend of delayed retirement? “Probably the industries in which customer care matters – retail trade, service sector – where older employees tend to be more polite, patient and have better phone manners” than younger employees, says Mitchell.