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Older Workers are Invaluable

Author: Helen Dennis, Specialist on Aging

I would like to share some information from a conference I recently attended in La Vegas. It was a workforce summit sponsored by the National council on Aging, and was part of a larger conference, titled “Aging in America,” sponsored by NCOA and the American Society on Aging.

The keynote speaker was Robert B. Reich, professor of public policy at the University of California, Berkeley, and former secretary of labor in the Clinton administration. I was honored to be invited as one of the panelists to respond to Reich’s address, the title of which was “Mature Workers: Key to a Competitive Work Force.” Here are a few facts for context:

Age discrimination allegations by employees have reached a record high, jumping 29 percent from 2007 to 2008; that’s from 19,103 claims to 24,600. This is the most dramatic increase of all employment complaints over that period.

Karen Ferguson, director of the Pension Rights Center in Washington, D.C., told The New York Times that older workers are caught in the middle of a “perfect storm.” Their “401(k) plans are going into the tank and their cost of health insurance is rising” and employers are “getting rid of more expensive employees” who are older. And they need to work.

A March 2009 report from the Urban Institute indicates that the unemployment rate for men 65 and older has reached the highest level recorded since the federal government began computing unemployment rates in 1948. That rate is 7.6 percent. The unemployment rate for women in that age group is 5.8 percent, the highest since 1992.

Although the unemployment rate for those 65 and older is lower than the approximately 8 percent rate for the U.S. population, older adults are at a disadvantage. They have a shorter timeline to make up for their losses and many will never work again – as their retirement savings dwindle and their health costs soar.

Now let’s focus on boomers. We know that two-thirds have not saved enough for retirement. Reich gave several reasons for this. As a reminder, boomers are those born between 1946 and 1964; the oldest is now 63. Many assumed their earnings would increase as their parents did. That’s not the case. The disillusionment began in the 1970s when male wages dropped. As a result, boomers developed several coping mechanisms.

Mechanism No. 1: Women entered the workforce hoping to compensate for lower wages, adding income to the family budget. That effort was insufficient.

Mechanism No. 2: Boomer couples assumed that if both worked longer hours, their financial position would increase. That also was insufficient. (Reich referred to these folks as “DINS – double income no sex.”)

Mechanism No. 3: The final attempt to meet expenses was to go into debt. That provided the capacity to spend now and pay later.

Because of this indebtedness, many boomers have not been able to save for retirement. As a result, many men and women in their 50s and 60s need to work longer and are competing with others who are desperate for jobs.

Reich’s focus was on mature workers and the assets they bring to the workplace.  “Employers need educated, experienced, knowledgeable, innovative and reliable workers,” he said. “These five assets make older workers a bargain.” And they have “relationship capital,” he said. They know the customers and the suppliers and how to keep them together.

Reich predicted an economic recovery in mid-2010. He also noted that public policies need to be enforced and some changed. Among his recommendations are the enforcement of the Age Discrimination in Employment Act, closing loopholes in the unemployment safety net, fewer barriers to those wanting to teach, and the availability of Medicare to a larger population. Each one of these recommendations is a huge topic for diverse opinions and debate. Unfortunately, there was no time for such discussion.

Reich’s main message was to affirm the value of mature, competent workers, emphasizing the role they can play in meeting company objectives and keeping America competitive. Let’s hope hiring managers share his view.

© Helen Dennis 2010, all rights reserved.

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