Diversity & Inclusion

Spotlight on Boomers: Boomers redefining retirement and flexibility

The face of aging in the United States is changing dramatically and rapidly, according to a new report from the U.S. Census Bureau. Today’s older Americans are very different from their predecessors, living longer, having lower rates of disability, achieving higher levels of education and less often living in poverty. And the baby boomers, the first of whom celebrated their 60th birthdays in 2006, promise to redefine further what it means to grow older in America. In addition to redefining aging in America, baby boomers are redefining retirement and flexibility for the American employer.

There are approximately 76 million baby boomers in the workforce — 64 million will be eligible to retire by 2010. Conversely, there are only 46 million Gen Xers in the workforce. It only takes simple subtraction to realize that those numbers could represent a crippling deficit in employees who have knowledge and experience specific to their industries.

Not ready just yet
Fortunately for employers, most baby boomers aren’t planning on taking early retirement. After falling for more than a century, the retirement age of American workers is on an upward trend. According to a recent survey, 43 percent of Americans believe they will have to work during their retirement. Many baby boomers plan on staying in the workforce past retirement for a variety of reasons: money, stimulation, to try something new, or because work is a big part of how they define themselves.

According to the U.S. Department of Labor, the number of workers age 55 and older is expected to grow from 15.6 percent of the workforce in 2004 to 21.2 percent in 2014. The Congressional Budget Office did the math, noting that an extra year of work reduces the need for retirement savings by over five percent and provides time “to save more and earn returns on the assets they have already accumulated.” With retirement accounts having taken major hits during the dot-com bust, many prospective retirees are nervous about their nest eggs and see an extra year or three of employment as a panacea.

But financial considerations are the prime motivation for only one-third of the workers who extend retirement; twice as many older workers respond that the “need to stay active” is pushing back their retirement plans. For the first time ever, average retirement ages are moving higher — from 61 in 1995 to 62 in 2002 and to nearly 65 today, according to a survey by John Hancock Financial Services.

Most older workers, however, no longer want the traditional choice of full-time work vs. full-time retirement. Instead, they seek flexible work arrangements such as part-time or seasonal work assignments. Regardless of whether mature workers stay full-time or part-time beyond retirement, employers must prepare to face issues that correspond with retaining a mature workforce.

To attract and retain older workers, employers must address how to include them as part of their diverse workforce.

Aging gracefully means flexibility
Some retirement-age baby boomers will want flexibility because, after all, these are their “golden years” and they want to be able to enjoy them. But there’s another growing group of boomers that don’t just want flexibility, they have to have it to stay in the workforce. The “sandwich generation,” a baby boomers subgroup, is distinguished by their dual caregiving responsibilities to their children and their aging parents. A flexible work schedule allows them to fulfill those responsibilities, which promotes greater focus and productivity during work hours.

Flextime. A flextime work schedule is a departure from the traditional 9-to-5 work schedule. Within defined limits, employees are allowed flexibility with respect to the time their workday begins and ends. For example, employees who work eight-hour days may begin work between 7:00 a.m. and 9:00 a.m. and end the workday between 4:00 p.m. and 6:00 p.m. Using flextime scheduling, you can establish “core time” (e.g., 9:00 a.m. to 4:00 p.m.) when all employees are required to be physically present at work.

Some of the advantages of flextime scheduling include a reduction in absenteeism; employees can schedule personal and family appointments without missing work. It also allows you greater flexibility in handling uneven workloads, and customer service is increased by the extended work hours. Flextime scheduling may be particularly beneficial for employees with caregiving responsibilities. It’s being used in metropolitan areas to address rush-hour traffic delays and other commuting issues.

Compressed workweeks. In a compressed workweek schedule, full-time employees work fewer than five days per week and more than eight hours per day. Workweeks of four 10-hour days or three 12-hour days are common examples of compressed workweek schedules. Employers operating seven days per week, like hospitals and nursing homes, lend themselves to the compressed workweek scheduling option.

A compressed workweek allows greater flexibility for personal or family-time activities and for scheduling personal appointments. Like flextime scheduling, the compressed workweek improves employee job satisfaction and morale, reduces absenteeism, and aids in recruiting new employees.

Job sharing. Job sharing is simply a flextime schedule that allows two part-time employees to share one full-time job. The option enables employers an opportunity to retain qualified employees who can’t or don’t want to work a full-time schedule. Job sharing can also be used during a reduction in force to limit laying off otherwise qualified employees. Clear and open communication between the two workers is required for job sharing to be effective. In some cases, both individuals may be scheduled to work overlapping days periodically to facilitate better communication.

Telecommuting. Telecommuting, or the “virtual office,” is perhaps the most controversial of the alternative work schedule arrangements. It allows employees to work away from the office, usually at home, using remote access software and other telecommunications equipment.

Keep it interesting
What’s another way you can prevent older workers from jumping at their first opportunity to retire? Keep their jobs interesting. More than half of the employees over 65 say they choose to remain in the workforce because they find fulfillment in their jobs — they like new challenges and new assignments. And one of the components of job satisfaction they cite most often is the opportunity to mentor and train other employees. “Deskless” jobs that allow them to interact with the public or clients at or away from the job site also appeal to seniors. (Wal-Mart, IBM, Home Depot, and Borders are only a few of the major companies that have taken advantage of that.)

Surprisingly, most old dogs actually enjoy learning new tricks. A corollary holds true as well: Studies show that older employees enjoy working with younger employees who mentor them by teaching them to grasp new techniques and new technologies.

5 thoughts on “Spotlight on Boomers: Boomers redefining retirement and flexibility”

  1. I’m one of the Boomers who will not retire, but at age 65 and 10 months, the requirement for full social security, will leave my employer,”retire” and open a consulting business. I could never quit working and look forward to the new challange. I may fall flat on my butt, but there is always, “would you like frys with that?”

  2. The present economic downturn will deepen dramatically during 2008, and even larger numbers of boomers will have to stay in the workforce to make up for continuing significant erosion of their retirement savings. One component of the downturn is the meteoric plunge of the U.S. dollar. Its value has fallen against more than 50 currencies worldwide. Inflation is soaring as we must purchase the enormous mass of imported goods we rely on daily with these “dollarettes”.

    We’re in for a rough ride with no end in sight. Those who can avoid a pink slip will be the winners.

  3. Thanks for the article. I’m a baby boomer and am actively gathering these types of articles to assist in my decision making for my retirement. My current employer is interested in working with me in a “reduced hours per week” arrangement and this article supports that type of arrangement.

  4. A well written article, and with that it is with respect that I mention that the Census Bureau Survey had been released in March 2006 and AARP had considerably different results in their more recent survey

    The survey results can be seen here http://money.cnn.com/2008/05/13/news/economy/retirement_survey/ also mentioned that Boomers have been hurting more than their parents, and are feeling the impact from the slowdown more than their parents and are reacting in ways that have risky implications for the future, the AARP said.

    Nearly one in four boomers said they were taking money out of their 401(k) retirement plans and other investments early.

    Americans aged 65 and older are struggling too. Nearly 59% in this age group said they were having trouble keeping up with the rising costs of food, gas and medicine.

    AARP also has a great article seperating the facts from the myth that also defines this, it was written in April O8 Top 10 Boomer Myths – Separating Fact from Fiction

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