How Lotteries Work: Structure, Drawings, Odds, Payouts

In the US, most states offer some type of cash lottery like Mega Millions or Powerball. When you play, you purchase a ticket in hopes of winning a cash payout at random.

Although the odds of winning a cash lottery are very low, Americans still spend billions of dollars each year on tickets. But not everyone considers the tax implications or what they would do with their earnings if they did win.

How do lotteries work?

When you play the lottery, you’ll spend a small sum of money to get the chance to win a huge prize. The winners are selected at random. If you pick all the winning numbers, you’ll win the jackpot, or share it with others who have all the correct numbers as well. Most lotteries also include smaller prizes for getting some combination of winning numbers, but not all of them.

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According to Professor Michael Collins, a chartered financial analyst and CEO of WinCap Financial, most cash lotteries are administered by the government. “Government-administered lotteries are usually run by state governments in order to raise revenue,” he explains.

The proceeds of lottery funds can go to fund education, provide treatment for gambling addictions, or to protect the environment. However, lottery proceeds account for a small source of any state’s revenue.

Note: The North American Association of State and Provincial Lotteries (NASPL) outlines the beneficiaries of different types of lotteries and how much money was transferred in total.

How do lottery drawings work?

“Consumers purchase lottery tickets, and the money they spend goes into the winning pot,” says Joel Ohman, a CFP® professional and CEO of The longer a lottery goes without a winner, the more money accumulates in the pool. When someone wins, the lottery pool starts over again.

Lottery winners are chosen at random via a drawing. For instance, the Mega Millions drawings happen on Tuesday and Fridays at 11 PM EST, and you can watch them on live TV.

During the living drawing, five white balls are selected at random, and the balls are numbered one through 70. Then one gold ball is chosen from a set of balls numbered one through 25. If the six numbers selected match your lottery ticket number, you’re the big winner.

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What are the odds of winning the lottery?

The odds of winning a lottery jackpot are very low, even if you buy tickets on a regular basis. And there’s a lot of variation in the odds depending on the type of lottery you purchase tickets for.

In general, the bigger the lottery, the lower your odds of winning. In the Powerball lottery, for example, players select five numbers from 1 to 69, and then choose one number from 1 to 26 for the Powerball. To win the jackpot, you have to get all six numbers. With so many possible combinations, the odds of winning come out to 1 in 292,201,338.

How do lottery payouts work?

There are two ways lottery winners can claim their earnings — as a lump sum or annual payments over time. Both options result in a lottery payout, but there are pros and cons to each.

You’ll receive your after-tax winnings immediately if you claim a lump sum payout. Choosing this option lets you start investing and taking advantage of compound interest immediately. 

But if you receive payments over time, commonly referred to as a lottery annuity, the total amount you receive will be closer to the advertised winnings. And annuity payments can protect winners who might be tempted to spend the money all at once.

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Lotteries and taxes

According to Collins, the tax implications of winning the lottery vary depending on the type of lottery and the jurisdiction in which it’s located.

“For example, in the United States, winnings from government-administered lotteries are subject to federal and state income taxes,” he says.

“Lottery earnings are considered wages by state and federal governments,” Ohman notes.  Winning a significant amount of money will probably push you into a higher tax bracket, “so not only will you pay higher taxes on your winnings, but you’ll also pay higher taxes on your regular wages,” he says. “The state tax will depend on where you live.”


Source: How Lotteries Work: Structure, Drawings, Odds, Payouts

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Welcome To The Vice Age: How Sex, Drugs And Gambling Help Americans Cope With Covid

The pandemic caused millions to lean in to good old-fashioned bad behavior. Two years later, business has never been better for cannabis, gaming and porn—and the high times are here to stay.

On March 13, 2020, everything changed for Doug, a 35-year-old manager at a supply chain logistics company in Chicago. He was told his offices were closed until further notice. Then the stock market took a dive, his 401K plunged, and several family members fell ill with Covid-19. As a father of four, in a house he recently bought, he was afraid for his family’s future.

For Doug, the glass of wine he usually had every night to unwind turned into a whole bottle. “My alcohol consumption turned into a seven-day affair,” he says. He’d usually top it off with some THC-infused gummies. And when sporting events returned, gambling helped him assuage his fear of an uncertain future.

Doug was not alone. As stay-at-home orders swept across the country in March 2020, Americans got high, got drunk, and turned to porn in order to cope with the many fears and anxieties that were symptomatic of the pandemic. Alcohol sales in 13 states surged more than 10% that first month of lockdown while wine sales jumped nearly 9%, according to a study conducted by the University of Buffalo. The number of cigarettes sold in the U.S. also increased in 2020, the first time in 20 years, according to the Federal Trade Commission’s Cigarette Report.

Dr. Peter Grinspoon, a primary care physician at Massachusetts General Hospital and an instructor in medicine at Harvard Medical School, saw more of his patients turn to drugs and alcohol to “blot out reality” after the start of the pandemic than the years before.

“In a perfect world, when under stress, we do yoga, eat tofu, exercise, talk to our best friend, but in reality, most of us rely on some kind of substance,” says Grinspoon, who has specialized in medical cannabis for more than 25 years. “You don’t have to be a rocket scientist to understand that while people are home, bored and lonely they’re going to drink and get high.”

Covid Lows, Cannabis Highs

As the pandemic took an unimaginable toll on thousands of lives a day and brought the global economy to a standstill, it also helped legitimize the legal marijuana industry. With lockdowns rolling across the country in March 2020, many states deemed cannabis dispensaries “essential businesses,” meaning they could stay open along with pharmacies, grocers and liquor stores.

Cannabis sales in Washington state rose 9% over the same month in 2019 to $99 million while in California, weed sales grew by 53% over March 2019 to $276 million. Several months later, on Election Day 2020, five states passed marijuana legalization laws. Overall, the legal cannabis industry had a sky-high year in 2020: legal sales surpassed $17.5 billion, a 46% increase in sales over pre-pandemic 2019.

With Covid attacking respiratory systems, many longtime pot smokers made the switch to edibles. According to Headset, the Seattle-based cannabis analytics firm, sales of edibles grew by 54% across six states—California, Colorado, Michigan, Nevada, Oregon and Washington—during 2020.

Cannabis Laws By State

“In a lot of ways, Covid accelerated the cannabis industry 10 years,” says Aaron Morris, the co-founder of Clackamas, Oregon-based edibles manufacturer Wyld. “It legitimized it in a way as a mainstream coping mechanism along with alcohol.” For Wyld, one of the country’s best-selling edibles brands, the pandemic put the company into overdrive. “Sales got crazy,” says Morris. “It was like toilet paper—edibles flew off the shelves.”

Morris says the pandemic spiked Wyld sales by 20%, but the uptick never slowed. Instead, sales were “boosted permanently,” he says. As a new normal took hold, the only fluctuations Wyld saw in sales were when stimulus checks went out. “Every time the government sent out checks, sales went on steroids for 30 days,” says Morris.

In 2019, Wyld generated $25 million in sales and by the end of 2020, it sold $64 million of its natural fruit gummies. By the end of last year, the company nearly topped $110 million in sales.

Morris is obviously pleased with how the company performed, but not surprised. “Everyone loves cannabis, everyone’s at home, you aren’t socializing, so what are you going to do on a Tuesday night or a Friday night?” says Morris. “Everyone just got lit.”

Higher and Higher

Annual state cannabis sales have grown rapidly and consistently since 2019.

In the United States, annual cannabis sales hit $25 billion in 2021, a 43% increase over 2020. Sales in Florida, where only medical marijuana is legal, and sales in Illinois, which has both medical and adult-use, jumped 70% from 2020 to 2021. In Massachusetts, sales increased 85% during the same period.

Despite the growth of edibles, marijuana flower sales didn’t slow down either. For Emily Paxhia, cofounder of cannabis investment fund Poseidon, what sticks out to her from the past two years is the rise in pre-roll sales. Joint sales shot up 47% from April 2020 to October 2021 in California, Colorado, Michigan, Nevada, Oregon and Washington.

Paxhia believes a touch of nihilism is driving this statistic. “I think the pandemic shortened the timeline of how we view and how we live our lives to be focused on today, tomorrow versus what’s happening in five to 10 years,” she says. “Why not just live now and live well now?”

Betting Against Covid

The start of the pandemic hit the gaming industry hard, and as travel restrictions expanded globally, Covid looked like a losing proposition for the house. Casinos across the U.S. shuttered for months due to stay-at-home orders. In Nevada, the country’s gambling mecca, gross gaming revenue dropped from $12 billion in 2019 to $7.8 billion in 2020.

But when vaccines became available and Covid restrictions eased, Americans flocked to Sin City and regional state casinos as gambling became a way for the country to let loose after the height of the pandemic. By the end of 2021, Nevada reported a 10-month winning streak of more than $1 billion in monthly gambling revenue and an annual record of $13.4 billion, an 11.6% increase over pre-pandemic levels.

“People were cooped up for, depending on their risk tolerance, six months to two years,” says Colin Mansfield, an analyst who covers gaming and leisure at Fitch Ratings. “There was a time when there was not much to do from an entertainment perspective except go to a casino. After the shutdown people wanted to go out and have a good time and spend some money.”

The Money Lines

Annual state gambling revenue has recovered from the pandemic thanks to pent-up demand and the rise in mobile betting and iGaming.

And as states were eager for more tax revenue, many pushed through laws to get mobile sports betting programs off the ground. In 2018, there were eight states with legal sports betting and by the end of 2021, 31 states had legal markets with 18 launching mobile sports gambling.

New York, which launched its mobile sports betting program in early January 2022, surpassed $1 billion in wagers in the first two weeks of legalization, double the amount sportsbooks took in on The Las Vegas Strip in all of December. By the last week of February, New York bettors had wagered a total of $3.1 billion since the program launched, translating into $204.6 million in gross gaming revenue and $104.3 million in tax revenue.

Mansfield says the pandemic gambling boom is far from over. The industry is growing as more states are legalizing sports betting and the broader casino market is also expanding. “We’re not forecasting any strong pullback in gaming revenues,” he says. “People like to gamble. I don’t think that’s really going away at all.”

Over time, gambling has made the leap from a vice that cities and states wanted to hide on riverboats and away from big cities to placing it in the center of major entertainment districts. The combination of the pandemic and the expansion of mobile sports betting brought gambling to the “mainstream conversation,” says Mansfield. “You can’t watch a game anymore without hearing about gambling.”

Gaming may be on a serious roll right now, but few are thinking about the long-term consequences. Bill Krackomberger, a veteran professional sports gambler, grew up in the seedier edges of the industry among loan sharks and underground bookies. Legalization of sports betting is a good thing, no doubt, but Krackomberger feels uneasy about how quickly an addictive pastime has gone mainstream.

“We’re going to see a fallout in about 10 years, not just among regular degenerates,” says Krackomberger. “I’m talking with doctors, lawyers, professionals, Wall Street guys, you’ll see—you won’t be able to get into a Gamblers Anonymous meeting.”

Legal Sports Betting in the the U.S.

Porn This Way

When the pandemic hit in March 2020, Maya Morena, an adult film performer and sex worker living in New York, knew she had to stop meeting clients. The respectable and polite ones disappeared, and it seemed like the only johns willing to pay for sex and risk getting Covid were the “scummy ones.” So, Morena, like millions of other workers in America, started doing business online—she began treating her OnlyFans page like a full-time job.

By the end of that first month, Morena says she made $4,800 producing and selling erotic videos on the U.K.-based streaming platform best known as the billion-dollar tech company that porn built. By January 2021, Morena, who is originally from Honduras, was making $6,000 a month on OnlyFans. As the pandemic wore on and she advertised her page and recruited new customers, she saw her business boom again. By September of last year, she hit $12,000 for the month.

Of course, the idea that anyone can launch an OnlyFans page and start reeling in money by showing a little skin is a lie, Morena says. It requires a lot of hard work. The number of paying users and content creators joining adult streaming platforms like OnlyFans, FanCentro, IsMyGirl, ManyVids, and others, is exploding but only the most dedicated creators can make a living. “It’s a thriving economy that’s ruthlessly competitive,” says Morena.

For OnlyFans, the pandemic helped it become one of the biggest social media platforms seemingly overnight with more than 180 million users and more than 2 million content creators who have earned a collective $5 billion by selling subscriptions to content. In 2019, it had 348,000 creators and 13.5 million users. In 2020, OnlyFans grew revenue by 540%, hitting $400 million.

The popularity of OnlyFans, which has attracted a diverse group of creators from a former pastor to porn stars like Sophie Dee to celebrities like Cardi B, has given birth to a whole new adult-rated streaming economy.

Naked Ambition

Since 2019, the number of content creators on OnlyFans has increased nearly sixfold, while the number of users has expanded by a factor of 13.

Evan Seinfeld, the Brooklyn-born second cousin of comedian Jerry Seinfeld, who launched the online adult content platform IsMyGirl in 2017, says the pandemic turbocharged his business. In 2019, Seinfeld had 500,000 users on his platform and 8,000 creators. By the end of 2020, 25,000 creators signed up and 1.5 million users joined. Today, the site hosts 2.5 million users and 50,000 creators, who collectively make millions of dollars a month.

“Everybody’s business is booming and growing,” says Seinfeld. “When people are alone in the house, people crave stimulus, they crave stimulation, they crave sexual excitement.”

While many sex workers and performers may have first joined a site out of desperation, he says, many eventually realized that selling erotic content to lonesome people stuck at home was a sustainable business.

Adds Seinfeld: “A lot of people needed a pandemic to realize that people who aren’t paying your bills don’t really have a right to have an opinion about how you earn your living.”

Or enjoy life.

Two years into the pandemic, Doug from Chicago is doing better financially—no other industry was in more demand than supply chain logistics—but he held onto some of his new vices, which he describes as “comforts.” Before the pandemic, he was trying to live a healthier life and moderate his food, drug, and alcohol intake. But his perspective has changed—happiness, not moderation, is part of his new approach.

“I’m enjoying the comfortability of my life,” says Doug. “Does it come with a few asterisks? Yes. But we’re not going to live forever.”

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I am a staff writer on the vices beat, covering cannabis, gambling and more. I believe in the many virtues of vices. Previously at Forbes, I covered the world’s richest people as a member….

Source: Welcome To The Vice Age: How Sex, Drugs And Gambling Help Americans Cope With Covid


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Alcohol Addiction 101 – What You Should Know For most adults, moderate or social alcohol use is not problematic, however, approximately 18 million American adults have an alcohol addiction. Here is some basic information to help individuals navigate problematic alcohol use.


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Survey : Inflation is Costing Americans

The vast majority of Americans expect inflation to continue for at least six months. Meanwhile, Americans on both sides of the aisle say rising prices are hurting their families.

Nearly 8 in 10 Americans expect inflation to increase over the next six months, according to a Gallup poll released Wednesday, suggesting that an issue predominantly emphasized by Republicans that has loomed large over the Biden administration is perhaps crossing party lines.

Although Americans typically predict rising inflation, it’s unusual to this degree, Gallup says. The current expectation is the highest the group has ever measured, at 79% of those surveyed, with the prior record set in September 2005.

The estimates come as a growing number of Americans – who have not had to deal with sharply rising prices in decades – have in recent months named the issue as a top problem facing the U.S., doing so at higher rates than in nearly 40 years.

But Americans are still more preoccupied with the government and the coronavirus pandemic, naming them as top issues over inflation. Still, concern over inflation and its longevity are expected to continue to increase, Gallup says, while more Americans will likely report financial hardship, spelling trouble for the Biden administration.

Among those most affected are lower-income households that are less able to accommodate the rising prices, Gallup says. And while just 10% of the country says inflation’s effects are so severe that their standard of living has been impacted, about half of Americans say higher prices are harming their finances in one way or another.

Meanwhile, Americans view the economy more negatively than positively overall. Just 23% describe economic conditions as good or excellent, while 77% think they are only fair or poor. And around two-thirds of Americans believe the economy is only getting worse.

Top Biden administration officials have taken to blaming inflation on the pandemic and global disruptions to the economy to counter negative polling, while touting such achievements as passage of the American Rescue Plan that put money into the pockets of Americans, rising wages and reductions in household poverty.

But the widespread expectation among Americans that inflation will climb in the next six months suggests that even among Democrats, the issue is top of mind.

According to Gallup, political considerations appear to influence to what degree people say rising prices are “hurting their families.” Whereas 60% of Republicans report experiencing hardship over rising prices and a similar share of independence agree, around 36% of Democrats say the same.



Kaia Hubbard is a general news reporter at U.S. News & World Report. She joined the company in 2020 as an intern, after previously writing for Willamette Week, her hometown paper. Kaia is a graduate of the University of San Diego, where she led her college paper as editor-in-chief, winning regional and national awards for her work.

Source: Americans Across Party Lines Are Feeling the Effects of Inflation: Survey | Economy | US News



The hottest inflation in nearly four decades will cost millions of Americans an additional $3,500 in expenses this year, according to a new analysis published on Wednesday. Findings from the Penn Wharton Budget Model, a nonpartisan group at the University of Pennsylvania’s Wharton School, show that most U.S. households will need to allocate at least 6% more of their budget in order to sustain last year’s spending level on goods and services.

That figure is even higher for low-income Americans, who need to increase their spending by at least 7%. The recent inflation burst is disproportionately hurting lower-income households, largely because they collectively spend more on energy – which has seen some of the wildest price swings over the past year – while wealthy Americans spend more on services, which has seen the smallest inflation increases. 

That could mean, based on 2020 spending data, that the bottom 20% of income-earners saw their consumption expenditure increase by 6.8% to $2,120 per household, while the top 5% saw a 6.1% increase, or roughly $7,636 per household. Middle-income earners also saw a large increase in expenses, with an increased consumption expenditure of $4,351, or an increase of 6.8%.

“Since higher-income groups had a bigger increase in expenditures in all categories, they also saw a bigger increase in total expenditure,” the analysis said. “However, because of variation in the composition of consumption bundles, we find that higher-income households had smaller percentage increases in their total expenditure.” 

The Penn Wharton analysis comes on the heels of a new government report that revealed consumer prices soared 6.8% in November from the previous year, the fastest pace since June 1982, when inflation hit 7.1%. 


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Omicron Job Loss? Unemployment Claims Unexpectedly Spike One Week After Steep Drop In Jobless Benefits Numbers

The number of new unemployment claims unexpectedly jumped for the second week in a row this month, despite a steep drop in the overall number of Americans receiving unemployment benefits just one week earlier—a concerning sign for the labor market recovery after experts warned a record surge in coronavirus cases—spurred by the rapidly spreading omicron variant—could slow the economic recovery.

About 230,000 people filed initial jobless claims in the week ending January 8, an increase of 23,000 from the previous week, according to the weekly data released Thursday. Economists were only expecting about 200,000 new claims last week, according to Bloomberg data.

“This may well be the first report suggesting Omicron is leading to new job loss,” Bankrate senior economic analyst Mark Hamrick wrote in a Thursday note, pointing out the largest increases were reported in California and New York, where new claims totaled more than 20,000 combined.

The new report also showed the number of Americans receiving unemployment benefits fell to less than 1.6 million in the week ending January 1, a decrease of 194,000 from the previous week and the lowest level since June 1973.

“The future path of the pandemic remains highly uncertain, but the underlying job market narrative overall continues be one of scarcity of available applicants and workers,” Hamrick said. “The latest wrinkle, the high level of individuals testing positive, becoming ill or staying away from work, has added to supply chain disruptions with inflation already running red-hot.”The new unemployment data comes after a disappointing labor report on Friday showed the U.S. added a lower-than-expected 199,000 jobs in December.

After the report, Hamrick said it was still “difficult to measure” the economic impact of the omicron variant at that point and cautioned against dismissing its potential, pointing out widespread worker shortages, stoked in part by lingering concerns over the pandemic, remain a big uncertainty.

Economists surveyed by Bankrate said the variant could weigh on job growth in the first three months of the year, but estimated the unemployment rate will fall from 3.9% to 3.8% in a year. Moody’s Analytics’ Mark Zandi shared a similar word of caution, saying, “Risks are rising,” and forecasting that the economic recovery “is set to turn soft” as omicron stunts business. Amid the latest surge, credit card spending and restaurant bookings have already dropped substantially, while widespread flight cancellations have been another economic concern, Zandi notes.

According to the Labor Department, the U.S. has thus far recovered about 80% of the 20.5 million jobs U.S. employers cut between March and April of last year.

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I’m a senior reporter at Forbes focusing on markets and finance. I graduated from the University of North Carolina at Chapel Hill, where I

Source: Omicron Job Loss? Unemployment Claims Unexpectedly Spike One Week After Steep Drop In Jobless Benefits Numbers


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How Millions of Jobless Americans Can Afford To Ditch Work

One of the more insidious myths this year was that young people didn’t want to work because they were getting by just fine on government aid. People had too much money, went the narrative.

Only trouble is, the numbers don’t back it up. Instead, early retirement — whether forced by the pandemic or made possible otherwise — is playing a big role in America’s evolving labor market.

People have left the workforce for myriad reasons in the past two years — layoffs, health insecurity, child care needs, and any number of personal issues that arose from the disruption caused by the pandemic. But among those who have left and are not able to — or don’t want to — return, the vast majority are older Americans who accelerated their retirement.

Earlier this month, ADP Chief Economist Nela Richardson said the strong stock market along with soaring home prices “has given some higher income people options. We already saw a large portion of the Boomer workforce retiring. And they’re in a better position now.”

In assessing the jobs recovery, economists have pointed out that while the unemployment rate has come down, the labor force participation rate hasn’t improved at the same pace. But Jared Bernstein, a member of President Joe Biden’s Council of Economic Advisers, said that once “non-prime age” workers — those over 55 — are excluded from the metrics a much clearer picture of how the labor recovery is doing emerges because it strips out the retirement narrative.

Last month, there were 3.6 million more Americans who had left the labor force and said they didn’t want a job compared with November 2019, says Aaron Sojourner, a labor economist and professor at the University of Minnesota’s Carlson School of Management.

Older Americans, age 55 and up, accounted for whopping 90% of that increase. “I think a lot of the narratives imagine prime-age workers as being missing, but it actually skews much older,” Sojourner told CNN Business.

The labor shortage and retirement

The oft-lamented labor shortage has become a shorthand for the complicated reality of the pandemic-era labor force. Americans are quitting their jobs in record numbers — more than 4 million each month since July — but much of that quitting is happening among young people who are leaving for other jobs or better pay. They’re not leaving the workforce entirely.

“Part of it is a job quality shortage,” says Sojourner. “It’s a bit of a puzzle why employers aren’t raising wages and improving working conditions fast enough to draw people back in. They say they want to hire people — there are 11 million job openings — but they’re not creating job openings that people want.”

Federal Reserve Chairman Jerome Powell underscored that issue during a news conference on Wednesday.”There’s a demographic trend underlying all of this… The question of how much we can get back is a good one, and what we can do is try to create the conditions,” that allow people to come back, he said.

To be sure, some companies have been raising wages to attract and retain staff. Some businesses also offer signing bonuses to get workers in the door. But economists aren’t sure whether these incentives are here to stay and will improve conditions for workers in the long term. “I can want a 65-inch TV for $50, but it doesn’t mean there’s a TV shortage, it means I’m not willing to pay enough to get somebody to sell me a TV,” said Sojourner..

Nearly 70% of the 5 million people who left the labor force during the pandemic are older than 55, according to researchers from Goldman Sachs, and many of them aren’t looking to return. Retirements tend to be “stickier” than other labor force exits, the researchers wrote. Even so, they expect that an improving virus situation and increased vaccination will allow older workers to return to the labor force.

In normal times, retired people are often drawn back into the workforce. But the “unretirement” rate fell significantly during the pandemic, exacerbating the shortage of workers, according to research from the Kansas City Fed. There are some early signs that seniors are coming back to the workforce as vaccination rates increase and employers offer higher wages.quintex-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-1-2-1-1-1-1-2-2-1-1-1-1-1-1-1-1-768x114-1-1-2-1-1-4-1-2-2-1-2-1-1-1-1-1-1-1-1

The unretirement rate fell to just over 2% early in the pandemic, but in recent months has ticked up to around 2.6%, according to Nick Bunker, an economist at Indeed. That’s still off from the pre-pandemic rate of around 3%.Then again, older workers are potentially competing with younger, more qualified applicants for jobs, which could make their return more challenging.

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