Magazine article Workforce

What If They Don't Retire?

Magazine article Workforce

What If They Don't Retire?

Article excerpt

Or can't? Whether by choice or necessity, three-quarters of all boomers will likely work past age 65 as full-time or part-time workers. HR managers must position their employment practices now, to ensure future success.

By profession, Dawn Moran is a compensation manager in southern New Jersey. By birth status, Moran is a late baby boomer (born in 1962). "At the current age of 35, I can't imagine ever retiring. I haven't saved enough money, even though my husband and I make in excess of $125,000 per year," says Moran, despite the fact that her job requires her to be a financial whiz. "We've been so busy putting kids through school and paying bills, housing expenses and so on, that we've saved very little. We understand the realities of Social Security and that it probably won't be around for either one of us." Moran's husband, 46, is also a boomer. Moran says that although she thinks she'll be working the rest of her life, or most of it, anyway, she'd still enjoy a shift in "traditional" work as she gets older.

Moran's vision of semi-retirement, somewhere between a full-time worker and a nonworking retiree, is an expectation shared by many baby boomers. Because a significant slice of the boomer population-72 percent, according to the Washington, D.C.-based Employee Benefit Research Institute's (ERBI) "1997 Retirement Confidence Survey"-think their future economic reality will require them to keep working beyond age 65, WORKFORCE urges human resources managers to do some serious thinking now about both the problems and the opportunities that a nonretiring or semiretiring workforce may create for their businesses. Because what HR professionals do now will be the reality that their companies, and their workers, will have to live with when the traditional retirement age begins to beckon.

Obviously, no one knows for sure what the future holds for employers, boomers or jobs. However, there's enough information available today to make educated predictions about the employment areas that are most likely to change if boomers don't retire in the traditional sense starting in the year 2011 (the year in which the oldest boomers will turn 65), and beyond. These issues include: the employment contract, health care and other benefits, staffing, and skills and training.

The employment "contract" may need to change. Topping the list of issues that organizations should consider now is the employer-employee contract or compact. This refers to the implicit or implied rewards that employers promise workers for the work they do. It's a subject that has undergone much discussion in the HR arena over the past year, and it's a key boomer agenda item. Traditionally, employers have not cut the proverbial cord when they retired their workers. They often provided rich pension and health benefits that, in conjunction with Social Security, Medicare and Medicaid, left employees so well taken of in their retirement years retirees usually had little to worry about. The future workplace contracts and social contracts probably can't afford to be so generous.

As time marches on, health and pension benefits in particular will continue to cost employers even more, leaving them with little choice but to ask employees to bear the greatest burden for these benefits themselves. It's a continuation of the trend toward employers offering less and employees contributing more.

In fact, employers may need to consider going even further by whittling benefits down to a small core of offerings, rather than continuing down the current path of offering just about everything under the sun-from onsite massages to concierge services.

The primary platform HR managers will need to formulate is: How paternalistic should their organizations be? Do companies want employees to continue to rely on them for their personal needs, creating expectations of entitlements? In fact, HR professionals should consider whether offering health and other benefits actually might encourage employees not to retire. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.