The vision of retirement is undergoing a major change. Many people envision that retirement is sitting at the local Starbucks chatting with friends or sitting on the front porch rocking away enjoying “the good life.” However, for many people that is not the good life and as a result the vision of what retirement will look like is undergoing a major change.
Many people are eschewing the thought of the good life retirement scenario for a number of reasons. First is the mortality reason. Studies have shown that people who retire early, in their 50’s (which used to be the gold standard for having had a successful career) suffer from an increased mortality rate. One study found that “…embarking on the Golden Years at age 55 doubled the risk for death before reaching age 65, compared with those who toiled beyond age 60…” Even a study published by the Social Security Administration in 1954 found that “A person compelled to retire, it is argued, loses his vitality and tends to die much earlier than if he is allowed to continue in gainful work.” (Excuse the sexist language, after all it was 1954)
Have to continue eating
Many older workers today are not retiring for a number of reasons. One reason often stated is that the recession of 2008-2009 destroyed retirement plans and forced older workers to continue to work just to be able to put some food on the table. Certainly that was an issue for people that had retirement plans invested in certain stocks that they needed to withdraw right at that time. That concern seems to have diminished some in 2016. Yet older workers are still not retiring.
Continuing to work
Today the vision of retirement for many is avoiding the rocking chair and working for themselves. I allude to this in my post of a couple of weeks ago, Future Friday: Will it be the older generations that drive the Gig economy, not the Millennials? A recent article written by Gemma Tetlow, Economics Correspondent in the online version of Financial Times says that the movement toward working as retirement is not only driven by financial necessity, it is also driven “by new opportunities for fulfilling, flexible work.”
In this article based on UK studies Tetlow says “…the type of work older people do — and why they do it — is often different from when they were younger, and from their younger counterparts today.” She goes on to say “Many older workers look for the opportunity to work shorter, more flexible hours. Working men in their late 60s work on average 10 fewer hours each week than those in their late 50s.”
Good for the economy?
Tetlow suggests that because older workers also have some sort of retirement fund “The ability to top up earnings with pension income means some older workers are keen to take part-time jobs that might be unattractive to younger workers looking for higher earnings.” She also says “A desire for more flexibility also partly explains the prevalence of self-employment among older workers.” As I talked about in my Future Friday post reference above many of the jobs that we thought would be taken by Millennials are being taken instead by older workers and bringing to employers skill sets and experience younger workers don’t.
Good for the person
Working a job is also good for the person. Older workers learn new skill sets and a sense of purpose. After having worked all your life, suddenly stopping is for some people more fearful than dying. For me the thought of just stopping to “retire” sounds dull.
Perhaps if I had a job that was physically taxing I might have a different notion, but I don’t. I write, I consult, I teach, and I speak. What is there to retire from? That stuff is fun. I think I am representative of many people my age and those younger that will be looking at retirement age in the next ten years. We will change the vision of retirement.
What does this mean for companies?
In the age of rampant ageism those companies that recognize the human resource that is available to them will have a competitive edge over those that continue to have “hire the young only” mentality. There will be vast amounts of knowledge, talent and hours that workers will bring to the job that other companies will be missing. It is time to wake up and take advantage of the availability of a cohort of people ready, willing and able to work.
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