The Best Life

Posted Wednesday, July 24th, 2013| Comments (5) rule
Challenges of an Aging American Workforce
Special contribution to AGEnda from Sloan Center Research Fellow and U.S. News & World Report Contributing Editor, Philip Moeller.
The following is reprinted with permission from U.S. News & World Report.
Philip Moeller
Contributing Editor, U.S. News & World Report
Editor, American History of Business Journalism
Research Fellow, Sloan Center on Aging & Work, Boston College
Twitter: @PhilMoeller

The aging American workplace will likely emerge as one of the dominant economic and human interest stories of the next 10 to 20 years. Many employers acknowledge the accumulated skills and wisdom older employees often possess. But employers also wrestle with a host of higher costs that many older employees incur – from higher pay levels to more expensive charges for health and disability insurance and other benefits.

In demographic terms, about 10,000 baby boomers in the United States will turn 65 every day until about the year 2030, according to the U.S. Census Bureau. Some years, this daily average will exceed 13,000. We see these and similar numbers all the time, and then we go about our daily lives while the impact of this age wave continues to accumulate and pose a growing set of challenges.

In retirement terms, the Great Recession shattered any notion that retirement would be a positive experience for millions of older Americans. The reality of inadequate retirement savings was masked by soaring values of real estate and other assets.

The 2013 Retirement Confidence Survey sponsored by the Employee Benefit Research Institute found only 24 percent of workers at least 55 years old have set aside more than $250,000 for retirement (excluding the value of their primary residence and any traditional pensions). More startling, 36 percent of this group have saved less than $10,000. (The survey included 1,254 individuals, of which 251 were retirees.)

Looking at this reality, economist Alicia Munnell, head of the Center for Retirement Research at Boston College, says Americans’ stark retirement futures give them only three realistic options: 1) Be poor. 2) Save more money, and be a little less poor. 3) Keep working. Increasingly, more older Americans are choosing the financial equivalent of door number three.

Even with more baby boomers extending their careers, large numbers of boomers will still retire, and finding enough new workers will be a growing challenge for many employers. The numbers of new entrants into the workforce is likely to fall short of the total of boomers headed for the exits. Immigrants could help ease this projected shortage, but it’s not clear if even a successful reform of the country’s immigration laws would lead to large increases in new immigrants.

Thus, employers will need to confront a number of challenges to accommodate more older employees. Among them are intergenerational relationships, age discrimination, physical job demands, training and flexible work schedules. Employers who successfully attract, retain, train and motivate older employees may enjoy a competitive edge, but it will be a big adjustment from the youth-centric culture of many workplaces.

Every year, the U.S. Bureau of Labor Statistics takes an in-depth look at the age composition of the nation’s workforce. The agency is not allowed to release data that would identify individual employers or specific workplaces, but it does report detailed information on the age composition of the workforce by industry and occupation. On average, more than 16 percent of employed Americans last year were between ages 55 and 64. Roughly 5 percent were at least 65 years old. Added together, about one-fifth of employed workers were at least 55 years old.

However, looking at occupational breakdowns reveals that many jobs with older-worker concentrations double and even triple this average. As the following table illustrates, some professions naturally retain older experts – clergymen, for example. In other cases, professions are dying and unable to provide attractive opportunities for newcomers. Based on these statistics, proofreaders, print binders, tool makers and postal service clerks are all professions parents are not likely to recommend to their children. Becoming a farmer or travel agent may also be off the table.

2012 Occupations with Oldest Jobholders
Occupation No. Jobs Ages of Jobholders (%)
  (000s) 55-64 65+ 55+
Funeral service managers 13 23.1% 38.5% 61.5%
Motor vehicle operators, all other 63 15.9% 39.7% 55.6%
Legislators 11 27.3% 27.3% 54.5%
Model makers and patternmakers, metal and plastic 11 45.5% 9.1% 54.5%
Farmers, ranchers, and other agricultural managers 944 26.4% 26.7% 53.1%
Judges, magistrates, and other judicial workers 67 38.8% 11.9% 50.7%
Proofreaders and copy markers 10 40.0% 10.0% 50.0%
Print binding and finishing workers 22 36.4% 13.6% 50.0%
Tool and die makers 56 39.3% 8.9% 48.2%
Postal service clerks 148 43.9% 3.4% 47.3%
Clergy 408 29.4% 17.2% 46.6%
Crossing guards 61 23.0% 23.0% 45.9%
Bus drivers 558 29.9% 15.6% 45.5%
Travel agents 73 21.9% 21.9% 43.8%
Embalmers and funeral attendants 16 6.3% 37.5% 43.8%
Sociologists 7 28.6% 14.3% 42.9%
Religious workers, all other 69 24.6% 17.4% 42.0%
Models, demonstrators, and product promoters 65 27.7% 13.8% 41.5%
Construction and building inspectors 118 33.9% 7.6% 41.5%
Judicial law clerks 17 35.3% 5.9% 41.2%
Source: U.S. Bureau of Labor Statistics

Yet looking at professions with larger numbers of jobholders produces a list with smaller percentages of older people but larger numbers of these individuals overall. Here is a list of five occupations with both large numbers of jobholders and above-average concentrations of older employees.

Large Occupations with Heavy Concentrations of Older Jobholders
Occupation 2012 Jobs (000s) Aged 55+ (%) Aged 55+ (000s)
Chief executives 1,513 36.3 549,219
Bookkeepers, accounting, and auditing clerks 1,268 34.2 433,656
Lawyers 1,061 32.8 348,008
Secretaries and administrative assistants 2,904 30.9 897,336
Postsecondary teachers 1,350 30.4 410,040
Source: U.S. Bureau of Labor Statistics

Now, there are not exactly cries of anguish that there might be an aging crisis among chief executives. But occupations like the ones listed above are certainly facing an age tsunami, or will be when the slow pace of the economic recovery produces labor shortages.

Right now, there is more concern that unemployment rates remain too high this late into a recovery. Clearly, technology and global competition have played an important, if hard-to-define, role in limiting job growth. Government fiscal policy has also turned negative due to the sequester and other spending cuts.

But, slow or not, job growth is coming. And the nation’s workplaces are going to get grayer.

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5 responses to “The Best Life”

  1. Linda Simpleman says:

    As an older worker, it is not possible to retire with this present economy. The health insurance rates are too expensive. The cost of living is higher than anticipated. I have worked to long to retire “poor”. The fear is how long the employer will allow you to work. I am very experienced in my field with over 25 years of experience. I am healthy at 62, but I am at the top end of the pay range.

  2. I’m struggling to find the evidence for the concluding sentence in the body of this article.

    The data seems to only suggest job prospects in dying professions and in entry-pay service functions. Ugh! That employers will continue to jettison their older expensive-to-pay and expensive-to-insure workers and then complain about the suck of FICA and Medicare will be America’s lot. Corps are likely to continue to fund BC’s Sloan and Marc Freedman’s Encore in the search for reducing potential social-unrest and steering the hapless into the non-competitive non-profit world.

    How about some new ideas?

    Tax incentives that scale with age? A staged-employee-exit strategy, that reverse-mirrors employee entry? New co-op legislation that supports collections of seniors being competitive with conventional corporations? New training programs to create more entrepreneurs and fund them among the senior population? More digital work-enchanges for local needs to be filled with local skills? Etc.

    Looking for new behavior from the same-old, same-olds, is likely yet another definition for insanity.

  3. Signs Blog says:

    aging is inevitable and projections warn their accentuation, increased longevity aging will convert a mass phenomenon in all European countries as the aging of the population is a demographic issue, but has no demographic solution in 20 or 30 years, there is no simple solution to the problem but that is no excuse for inaction.

  4. Lavonda Litz says:

    It’s really a nice and useful piece of information. I am glad that you shared this useful information with us. Please keep us informed like this. Thanks for sharing.

  5. Bill says:

    I’m originally an eningeer, and have been a software developer for some time. I’m somewhat leery of anything that smells of advertising as such. I drink Coke or RC rather than the more heavily advertised Pepsi because they taste better. In other words I’m adverse to a sales pitch, and I wonder how many interviewers are the same way. “Personal branding” might work when trying to get a job in the advertising business, but it doesn’t work so well in technical areas.Comments?