The Upcoming Retirement Wave

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The Upcoming Retirment Wave,The Upcoming Retirment Wave,
Copyright 2009, Dickson R.Copyright 2009, Dickson R.
Dawson, PhD.Dawson, PhD. 11
The Upcoming Retirement Wave:The Upcoming Retirement Wave:
What HR Needs to KnowWhat HR Needs to Know
Presented byPresented by
Dickson R. Dawson, PhD.Dickson R. Dawson, PhD.
Retirement IntentionsRetirement Intentions
andand

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What you might find interestingWhat you might find interesting
today:today:
 The new face of retirementThe new face of retirement
and the world of the olderand the world of the older
employeeemployee
 Boomers and organizationsBoomers and organizations
= WIN-WIN= WIN-WIN
 The aging workforce andThe aging workforce and
working in retirementworking in retirement

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What you might find interestingWhat you might find interesting
today (continued):today (continued):
 Myths about older workersMyths about older workers
 Aging boomers and opportunityAging boomers and opportunity

Shameless Commerce DivisionShameless Commerce Division
 Retirement IntentionsRetirement Intentions
 Ease@WorkEase@Work
 CareerCurveCareerCurve
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How I start every program:How I start every program:
Please stand up.Please stand up.
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Retirement Has ChangedRetirement Has Changed
 Organizations will feel BabyOrganizations will feel Baby Boomer WaveBoomer Wave
 Baby Boomer Wave is real, just not hit with fullBaby Boomer Wave is real, just not hit with full
force, yetforce, yet
 The Baby Boomer Wave – a benefit, not just aThe Baby Boomer Wave – a benefit, not just a
problemproblem

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Baby Boomers and OrganizationsBaby Boomers and Organizations
Both WinBoth Win
 YYouou needneed:: talent, skill, savvy, integrity andtalent, skill, savvy, integrity and
reliability.reliability.
 BoomersBoomers needneed:: income, engagement, workingincome, engagement, working
with others, flexibility and feeling valued.with others, flexibility and feeling valued.

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The World of the Older EmployeeThe World of the Older Employee

Not your father’s or mother’s retirementNot your father’s or mother’s retirement

““65 and out” with pension or Social Security65 and out” with pension or Social Security

……and a life expectancy of a 2-5 yearsand a life expectancy of a 2-5 years

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So many things have changed, mostly:So many things have changed, mostly:
• LongevityLongevity
• Illnesses associated with living longerIllnesses associated with living longer
• Health careHealth care
• Social Security, pensions, 401ksSocial Security, pensions, 401ks
• The need to work for money and activityThe need to work for money and activity

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
More than just golf, babysitting grand kids,More than just golf, babysitting grand kids,
and Adirondack chairsand Adirondack chairs

Another 20, 30, even 40 yearsAnother 20, 30, even 40 years

Another stage of lifeAnother stage of life

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
Unpredictability = fears and worryUnpredictability = fears and worry

Becoming ill with not enough $Becoming ill with not enough $

The average out-of-pocket expense forThe average out-of-pocket expense for
retirees healthcare costs is $250,000 perretirees healthcare costs is $250,000 per
personperson

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
. ..more than one-quarter of boomer households. ..more than one-quarter of boomer households
thought "hardly at all" about retirement and thatthought "hardly at all" about retirement and that
financial literacy among boomers wasfinancial literacy among boomers was
"alarmingly low.""alarmingly low."

National Bureau of Economic Research quoted inNational Bureau of Economic Research quoted in BoomersBoomers
Going Bust,Going Bust, By David Ignatius,Thursday, May 7, 2009,By David Ignatius,Thursday, May 7, 2009, TheThe
Washington PostWashington Post..

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Guaranteed retirement funds andGuaranteed retirement funds and
healthcare are only part of thehealthcare are only part of the
retirement package…and not for allretirement package…and not for all

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What do you know about our agingWhat do you know about our aging
workforce?workforce?

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What is a “Baby Boomer”?What is a “Baby Boomer”?

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 What is a “Baby Boomer”?What is a “Baby Boomer”?

Person born between the end ofPerson born between the end of
World War II and 1964.World War II and 1964.

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How many Baby Boomers areHow many Baby Boomers are
there?there?
About 79 million!About 79 million!
(think of the brain power ……think of the buying power!)(think of the brain power ……think of the buying power!)

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How many Baby Boomers areHow many Baby Boomers are
there?there?

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What is the average age of firstWhat is the average age of first
retirement in the US?retirement in the US?

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What is the average age ofWhat is the average age of firstfirst
retirement in the US?retirement in the US?

About 62, up from 58 a few yearsAbout 62, up from 58 a few years
agoago

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•What is the life expectancy inWhat is the life expectancy in
the US?the US?

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What is the life expectancyWhat is the life expectancy
in the US?in the US?

US = 45 out of 195:US = 45 out of 195: ((CIA World FactbookCIA World Factbook))
• Rank/Country/territory Life expectancy at Rank/Country/territory Life expectancy at
birth (years) birth (years)
• Overall Male/Female World average 67.26Overall Male/Female World average 67.26

43 Bermuda ( UK)43 Bermuda ( UK) 78.1378.13

44 Saint Helena ( UK)44 Saint Helena ( UK) 78.0978.09

45 45 United StatesUnited States 78.06 *78.06 *

46 Cyprus46 Cyprus 77.9877.98

47 Denmark47 Denmark 77.9677.96

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2323
Indicator 14 – Life Expectancy

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2424
Current US Life ExpectancyCurrent US Life Expectancy
 What does this mean?What does this mean?

Between 55 and 65 now, mostBetween 55 and 65 now, most
likely live another 20 to 40 yearslikely live another 20 to 40 years
(There are 86,000 people in the US 100 years(There are 86,000 people in the US 100 years
old, or older)old, or older)

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 s)s)

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2626
Did you know:Did you know:
Retirement plans originally set up forRetirement plans originally set up for
retirees that would not live past 65retirees that would not live past 65!!

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 What is the potential of the “retirement wave”What is the potential of the “retirement wave”

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 What is the potential “retirement wave”What is the potential “retirement wave”
• 7,918 people turn 60 each day.7,918 people turn 60 each day.
That isThat is 330 every hour330 every hour
U.S. Census BureauU.S. Census Bureau

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 Some thoughts about the “retirement wave”Some thoughts about the “retirement wave”
• ““America is facing a demographic juggernaut,"America is facing a demographic juggernaut,"
says Brent Green, a marketing consultant andsays Brent Green, a marketing consultant and
author, in his ‘Boomers’ blogauthor, in his ‘Boomers’ blog
• One-third of the population will be over 50 byOne-third of the population will be over 50 by
2010. One in five will be over 65 by 20102010. One in five will be over 65 by 2010

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 How many retirees continue to work (forHow many retirees continue to work (for
income) in retirement?income) in retirement?

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• 29% in their late 60s, were still29% in their late 60s, were still
employed in 2006-Bureau of Laboremployed in 2006-Bureau of Labor
StatisticsStatistics

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• 72% of retirees will work, in some72% of retirees will work, in some
capacity, after “retirement”capacity, after “retirement”

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So then, what is retirement?So then, what is retirement?

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So then, what is retirement?So then, what is retirement?
Once meant:Once meant:
• stop workstop work
• life of leisurelife of leisure
• health declineshealth declines
• then you diethen you die

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So then, what is retirementSo then, what is retirement
today?today?

Stop work at one placeStop work at one place

Start work at another placeStart work at another place

Or start a new careerOr start a new career

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What do Baby Boomers want inWhat do Baby Boomers want in
continued employment?continued employment?

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 What do Baby Boomers want in continuedWhat do Baby Boomers want in continued
employment?employment?
MONEY!!!MONEY!!!
To makeup for their losses in investmentsTo makeup for their losses in investments
• 4.2 years to make up for losses4.2 years to make up for losses
• But, there is so much more…But, there is so much more…

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Staying Ahead of the Curve 2003: TheStaying Ahead of the Curve 2003: The
AARP Working in Retirement StudyAARP Working in Retirement Study..
 What do Baby Boomers want inWhat do Baby Boomers want in
• employee opinions are valuedemployee opinions are valued
• take time offtake time off
• a company that lets its older employees remaina company that lets its older employees remain
employed for as long as they wish to workemployed for as long as they wish to work

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 What do Baby Boomers want inWhat do Baby Boomers want in

Feel engaged, part of somethingFeel engaged, part of something

Not oldNot old

Not be thought of as oldNot be thought of as old

Renewed, rejuvenatedRenewed, rejuvenated

Active, growingActive, growing

Sharp and alertSharp and alert

More free timeMore free time

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 Most importantly to:Most importantly to:
Feel that they matter!Feel that they matter!

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 Baby Boomers can contributeBaby Boomers can contribute

But first, dump the stereotypes concerningBut first, dump the stereotypes concerning
older workers – that they…older workers – that they…
• Are anxious to leave,Are anxious to leave,
• have trouble learning new skillshave trouble learning new skills
• will drive up costs, including health carewill drive up costs, including health care

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 Baby Boomers can contribute to yourBaby Boomers can contribute to your
organizationorganization

Day-to-day productivityDay-to-day productivity

MentoringMentoring

Competitive marketplace knowledgeCompetitive marketplace knowledge

Make up for a shortfall in talent…Make up for a shortfall in talent…

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Who will replace retirees if/whenWho will replace retirees if/when
they leave?they leave?

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“Everyday, 11,000 boomers turn 50.
There are only 43 million Gen Xers to
fill the boomers’ 152 million shoes.”
-Beverly Kay and Joyce Cohen, T & D, April, 2008, p. 30

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Myths of Older WorkforceMyths of Older Workforce
 Myth 1:Myth 1: Older workers cost more to keepOlder workers cost more to keep
 RealityReality::

Older workers often earn more than younger workers,Older workers often earn more than younger workers,
BUT,BUT,
• Evidence to show that older workers can be moreEvidence to show that older workers can be more
productive than their younger counterparts ( Bobproductive than their younger counterparts ( Bob
Skladany, AARP.org.)Skladany, AARP.org.)
• Older workers have fewer absences, a strongerOlder workers have fewer absences, a stronger
work ethic, and greater loyaltywork ethic, and greater loyalty
• A seasoned knowledge base is critical to successA seasoned knowledge base is critical to success
• Many older workers are open to less than full-timeMany older workers are open to less than full-time
workwork

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Myths of Older WorkforceMyths of Older Workforce
Myth 2:Myth 2: Health benefits for Baby Boomers are too costlyHealth benefits for Baby Boomers are too costly
 Reality:Reality:

Health insurance does cost more for older workers,Health insurance does cost more for older workers,
BUT,BUT,
• Differences in younger vs. older workers claimsDifferences in younger vs. older workers claims
• are not hugeare not huge
• Older workers get single or two-person coverageOlder workers get single or two-person coverage
rather than expensive family coveragerather than expensive family coverage
• Some studies show that older workers areSome studies show that older workers are
healthier on a day-to-day basishealthier on a day-to-day basis
• There are alternatives, like HSAs, to traditionalThere are alternatives, like HSAs, to traditional
healthcare insurances that could be very attractivehealthcare insurances that could be very attractive
to older workersto older workers

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 Myth 3Myth 3. Retirement plan costs can be. Retirement plan costs can be
expensiveexpensive
 RealtyRealty::

Traditionally designed benefit plans increaseTraditionally designed benefit plans increase
as workers age, BUTas workers age, BUT

DB pension is disappearing.DB pension is disappearing.

DC plans such as 401(k) before less costlyDC plans such as 401(k) before less costly

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 When you look at the big picture, older workers:When you look at the big picture, older workers:

Are equally or more productive than youngerAre equally or more productive than younger
employeesemployees

Cost about the sameCost about the same

Have fewer absencesHave fewer absences

Have superior communication and customerHave superior communication and customer
relations skillsrelations skills

Are less likely to leave the job after a short timeAre less likely to leave the job after a short time

Require lower training costsRequire lower training costs

The bottom lineThe bottom line: Older workers are both profitable: Older workers are both profitable
and productive.and productive.

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If your organizationIf your organization does notdoes not want to orwant to or
need to address baby boomer issues, atneed to address baby boomer issues, at
least consider this:least consider this:

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If your organization doesIf your organization does not wantnot want to orto or
need to address baby boomer issues, atneed to address baby boomer issues, at
least consider this:least consider this:
Three demographic factors are converging:Three demographic factors are converging:
1.1. The population as a whole is aging,The population as a whole is aging,
2.2. Labor shortages are projected in a numberLabor shortages are projected in a number
of economic sectors, andof economic sectors, and
3.3. Many workers intend to continue workingMany workers intend to continue working
beyond traditional retirement age.beyond traditional retirement age.

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If your organizationIf your organization doesdoes want to or need towant to or need to
address baby boomer issues, at leastaddress baby boomer issues, at least
consider this:consider this:

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Programs and Plans for BabyPrograms and Plans for Baby
Boomers at WorkBoomers at Work
 Phased retirementPhased retirement
 Knowledge transfer programsKnowledge transfer programs
 Intergenerational communication programsIntergenerational communication programs
 Training designed specifically for older workersTraining designed specifically for older workers
 Active alumni groups- ambassadorsActive alumni groups- ambassadors

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 Self scheduling shiftsSelf scheduling shifts
 Flexible timeFlexible time
 Compressed workweekCompressed workweek
 Job sharingJob sharing
 Extended time offExtended time off
 Consulting assignmentsConsulting assignments

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 And, most importantly:And, most importantly:

Wellness and fitness programs, not just for olderWellness and fitness programs, not just for older
workers, but for everyoneworkers, but for everyone

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The Opportunities for HumanThe Opportunities for Human
ResourcesResources

Filling the Talent Pool with seasoned olderFilling the Talent Pool with seasoned older
workersworkers

Non-retirement as a career choiceNon-retirement as a career choice

Talent and know-how that might walk out theTalent and know-how that might walk out the
door can be harnesseddoor can be harnessed
And…And…
If I were your competition…If I were your competition…

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Response to Retirement Needs toResponse to Retirement Needs to
ChangeChange
 Assess what you have to work withAssess what you have to work with
 Decide where your organization is headedDecide where your organization is headed
 Be open and creativeBe open and creative
 And beAnd be DaringDaring…or at least try something…or at least try something
newnew

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Thank you!Thank you!

The Upcoming Retirement Wave

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Editor's Notes