Aging Graying Workforce Term Paper
- Length: 7 pages
- Subject: Careers
- Type: Term Paper
- Paper: #68794787
Excerpt from Term Paper :
The month of May was initiated by President John F. Kennedy as the month to honor the contributions of older Americans (Older pp). At that time roughly seventeen million living Americans had reached their 65th birthdays, today, approximately thirty-five million Americans, or one in eight, are 65 years old or older (Older pp). According to the United States Census Bureau, nineteen percent of men and ten percent of women over 65 years old are still working, and moreover, seventy-five percent of men and sixty-three percent of women over 55 years old are still employed (Older pp). Because so much has changed demographically since it originated, Older Americans Month has evolved into an opportunity to focus on the needs and concerns of the aging population (Older pp). Experts say that the coming decades will require companies to be knowledgeable concerning the needs of older workers (Older pp). Due to a scarcity of skilled labor, economic factors, and a resistance of being sedentary, many baby boomers will work well beyond the traditional retirement age (Older pp).
Many retirees, like Margaret Wellons are either staying in the workforce or returning on a part-time basis (Said pp). At 63 years old, Wellons took early retirement from her University of California-Berkeley job as a student adviser in 1993, but has returned as a student-affairs officer while a permanent employee is on medical leave (Said pp). She is part of a pilot program that was started two years ago, in which the university hires retired administrators and professional workers on a temporary, part-time basis to replace workers on medical leave, to fill in when a position is being advertised or to help with special projects (Said pp). Wellons relishes the temporary assignments because she says it gives her extra income, she is able to control when she works, and it allows her to stay involved in the university community (Said pp). Hiring retired workers has many advantages for the university as well, for it is able to tap into a pool of experienced people who are familiar with the institution and its culture and therefore can "come back and jump into things very quickly and easily," says Shelley Glazer, executive director of Berkeley's Retirement Center (Said pp).
The university, which hires retirees for such tasks as grant writing, budget work, strategic planning and organizational development, is careful not to cut career positions, with time worked limited to slightly less than half-time in each monthly pay period (Said pp).
Berkeley is just one of many organizations and businesses that are following a trend that is likely to become common as the throngs of baby boomers, 77.5 million of them ranging in age from forty-one to fifty-nine, begin to retire over the next few years (Said pp). Although this is the era of downsizing and outsourcing, workforce experts say that companies and government agencies will soon need to encourage older employees to work longer due to the fact that there are not enough experienced younger people to replace them (Said pp). According to Social Security Administration projections, labor-force growth, which is a major driver of economic growth, will slow from 1.6% today to 0.3% by 2020 (Said pp). In response, companies will soon need to devise creative strategies to keep older workers on the job such as hiring them as temps, allowing employees to phase into retirement by working part time, allowing experienced workers to mentor younger employees, encouraging retirement age workers to take sabbaticals rather than stepping down, offering bonuses to delay retirement, and promoting telecommuting, flexible hours and job sharing (Said pp). When the Senate Special Committee on Aging held hearing about redefining retirement in the twenty-first century, Senator Herb Kohl, D-Minn., the committee's ranking Democrat, said, "With more American retiring and fewer younger workers to replace them, companies face a labor-force shortage ... In the future, our economy will increasingly depend on keeping experienced employees in the workforce" (Said pp). According to Kohl, the country could face a gap of approximately 18 million workers by 2020 (Said pp).
Experts say that baby boomers are expected to want to work into their retirement years, mainly because they are a generation of notoriously poor savers and because, with longer life expectancies, elders are likely to sill crave challenges (Said pp). Surveys by the American Association of Retired Persons, AARP, have shown that eighty percent of boomers expect to work in retirement, a dramatic shift from the thirteen percent of people over 65 years of age currently in the workforce (Said pp). Tom Matthews, a consulting actuary at human-resources consulting firm Towers Perrin in San Francisco, says,
"It's the perfect storm in all the right ways
Employers will have a real need to retain people
because of the baby-boom bubble ... They won't want to see the expertise of highly skilled people walk out the door ... Employees will need and want to work because they can't afford to retire"
Many believe that the government could take several measures to help encourage people to stay in the workforce (Said pp). According to current Internal Revenue Service rules, retirees younger than 65 years of age cannot work part time for a company and receive a traditional pension from that company, thus, an employee who wants to phase into retirement may choose to draw a pension from his or her original employer and then go to work part time for a competitor (Said pp). Naturally, companies would rather keep their original employees, therefore, the IRS is considering allowing people to collect a pension at ages 59-1/2 years of age and continue working part time for the same emplyer (Said pp).
Helen Dennis, a professor at the Andrus Gerontology Center at the University of Southern California, says, "Retirees are being looked at as the new human resource" (Said pp). According to Dennis, unemployment is high, yet because middle management costs too much, mature workers are the ones who are getting moved out, while at the same time, there is a workforce shortage in certain industries such as health care, information technology, and mental health (Said pp). Dennis says that now employers are saying, "Where are our mature confident workers? How do we keep them and how do we get them back" (Said pp)?
Although older workers continue to work and retirees return to work for several reasons including financial reasons, socialization, and wanting to contribute and feel valued, with personal savings significantly lower than in the past, the most compelling reason for older Americans to work is economic (Lockwood pp). In the 2002 Life Planning Survey, information regarding work and life priorities of older workers, data indicated that fewer than half of the respondents plan to retire within five years (Lockwood pp). The majority of older workers remain in their jobs for economic reasons, however, many stay because they want to be active, and approximately two-thirds of the respondents indicated that they want additional training and leadership development opportunities (Lockwood pp). It is interesting to note that the survey results do not concur with the belief that many older workers retire due to work/life concerns, but rather, remain in the workforce to have the financial means to handle eldercare needs (Lockwood pp). According to the Center for Retirement Research at Boston College, "the labor supply of the elderly is concentrated among the healthiest, wealthiest, and most educated individuals, yet they earn very low wages with seventy percent of individuals aged 70 and above earning wages in the bottom quintile of the overall wage distribution of those aged 50 to 61 years (Lockwood pp). Moreover, since Americans are living longer, there are increased concerns about social detachment and isolation, thus, work has become increasingly important as a social outlet (Lockwood pp). In the workplace, older workers have a sense of accomplishment and responsibility, therefore, older Americans are more willing to continue working past traditional retirement age (Lockwood pp).
Worldhealth.net reports that 7.5 million Americans that are 55 years old and older belonged to gyms in 2002, compared with 1.5 million in 1987 (Wilson pp). Older Americans today have not only the desire but also the ability to stay in the workforce well past the age of retirement (Wilson pp). A recent poll from The Wall Street Journal and NBC News revealed that retirees were more interested in an active life, which involved working, than their parents' generation (Wilson pp).
While some older workers are returning to the traditional workforce, others are seeking new work options such as franchising (Wilson pp). David Handier, senior vice president of the International Center for Entrepreneurial Development, says, "They've perhaps lived the corporate life, and they're ready to try it on their own" (Wilson pp). Many retirees, like Dan and Mary Ann Jones, who represent this growing population of older franchisees, decided after a couple of years of retirement, that they were bored (Wilson pp). Says Dan, 58, "We were doing nothing, playing golf and having fun ... We decided we needed to…