Rethinking Retirement Is Necessary
How can Congress help seniors in the work force?
New challenges — and new opportunities — await us as our aging population doubles within the next decade. Today, people over the age of 65 make up roughly 12 percent of the population, but in the next 25 years they will account for almost 20 percent. That means one out of every five Americans will be a senior by 2030, at which time economists predict that businesses could face a labor force shortage of 35 million workers. They warn that this could translate into slower economic growth, and therefore lower living standards for everyone.
Fortuitously, studies show that as older Americans live longer and healthier lives, many are planning to work longer. According to a recent survey, 80 percent of baby boomers expect to work past traditional retirement age. Some may recognize the physical and mental benefits of work, while some may need the additional income to remain financially secure as they struggle to stretch their retirement savings.
Whatever the reason people decide to stay on the job, we must change the way our nation thinks about life after 65. A one-size-fits-all retirement approach will no longer match the very different plans that seniors and baby boomers have for their later years. We must make it easier for seniors to stay in the work force if they wish to continue contributing their skills and expertise. And as the statistics show, rethinking retirement is vital, not only to the quality of life for an aging population, but also to our nation’s economic future.
Luckily, this generation of seniors is unlike any group we have seen before. Through the years, they have built our economy into the strongest in the world. They have fought for and defended the freedoms we enjoy today. And they have worked hard to care for the most vulnerable among us. Seniors are a treasure trove of knowledge, experience and wisdom that our country should value and put to good use.
It is in our best interest to bolster the ability of older Americans to remain in the workplace if they so choose. Most older workers would choose to work past traditional retirement age if they were offered the ability to gradually transition into retirement with a part-time schedule. Many seniors also would be interested in volunteer activities and community service if employers and organizations were open to it. Unfortunately, remaining in the workplace often is not an attractive choice for seniors.
Currently, there are many barriers that make it difficult, if not impossible, for those who have reached traditional retirement age to stay on the job. For example, today’s workplace rarely offers flexible and part-time work arrangements for older workers. Rigid workplace demands, lack of health care coverage, denial or reduction of pension benefits, and the caregiving needs of a loved one are other issues that need to be addressed to allow older workers to make the choice to postpone retirement a little longer.
On the Senate Aging Committee, these are issues we are focused on. Later this month, I will hold a hearing on older workers, focusing especially on the need for our nation’s policies to embrace them to stave off a slowdown in economic growth. During the previous session of Congress I sponsored legislation on this topic, and I look forward to doing so once again in the 110th Congress.
Seventy-seven million people are approaching traditional retirement age, and we must do all we can to curb a major work force drain. We can soften the potentially serious impact of these trends if we develop policies that expand opportunities for older Americans to work longer.
Employers should be encouraged to offer flexible and part-time work arrangements, which would benefit both older workers and employers through increased productivity and job retention. We also should address health coverage for older workers in part-time jobs, the demands that ailing family members can have on working seniors, and access to federal job training programs.
We face a historic challenge, and with it, a historic opportunity. We need a 21st-century workplace that is a win-win for both older workers and their employers — and an effective strategy for retaining our competitive advantage against other countries facing the same demographic tidal wave. We need to usher in a new age of work and retirement in which seniors are not limited to a choice between one or the other. We need to empower seniors to continue to make the contributions they are capable of to our economy and our communities.
Many older Americans and employers already have begun to pave the way. More older Americans are staying active and productive in the workplace, and more employers are recognizing the value of older workers. We must incorporate this new mind-set into our national culture and develop policies that reflect this reality. Our seniors deserve it, and our economic future may well depend on it.
Sen. Herb Kohl (D-Wis.) is chairman of the Aging Committee.