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Work is the aging issue.
And work isn’t a profane four-letter word.
It’s a four-letter word that should have a good connotation. And work is a reality. Even for those who have saved adequately for retirement, and most Americans haven’t, work is a financial safety net.
Vast unemployment has crushed American workers, and those who are over 55, face additional obstacles to landing a new job. That, too, is real.
The pandemic and unemployment for older workers
The average duration of unemployment for older workers is longer than those faced by younger cohorts. The number of long-term unemployed job seekers out of work for more than 27 weeks and still job-hunting, soared to 26.4% in September from 14% in August for those 55 and older, according to the Bureau of Labor Statistics. That’s higher than for the total workforce, where long-term unemployed job seekers rose to 18.2% from 11.3%.
This past week I had the opportunity to moderate a panel at the The Journalists in Aging Fellows Program presented by The Gerontological Society of America (GSA) and the Journalists Network on Generations.
One of the panelists, my go-to expert Richard W. Johnson, Urban Institute Senior Fellow and Director, Program on Retirement Policy.
His presentation “Crisis for Older Workers: COVID Layoffs and Beyond,” was riveting and filled with important research.
The highlights of his talk:
During past recessions, older workers were less likely to become unemployed than younger workers. But not this time around. As unemployment rates fell later in 2020, the unemployment gap between older and younger workers narrowed, but rates at ages 65+ remained unusually high. And when older workers land new jobs, historically, it’s often at a lower wage than their previous job, Johnson said.
Working at older ages has a significant impact on the overall economy and individual financial security, Johnson explained. “Older workers pay taxes, engage in productive activities, delay receipt of retirement transfers,” he said. “That helps grow the economy, and improves the fiscal outlook. And when workers earn more, over their lifetimes, by delaying retirement that raises their future earnings base for Social Security and pensions. Plus, workers can save more for retirement.”
Social Security benefits are increased by 8% a year (over the amount at full retirement age) for every year you postpone receiving checks between your full retirement age and age 70.
Read: I have a seven-figure nest egg — am I saving too much for retirement?
And the dominoes roll out. Those investments continue to grow and have the ability to ride out market plunges like we saw this past week. “And by delaying retirement, older workers reduce the time that savings must last,” Johnson said.
Plus, there are the psychological, mental agility, and physical benefits of using our brains to solve problems, feeling relevant, feeling connected to others, staying part of the world.
COVID-19 and retirement insecurity
Few Americans have saved adequately for a retirement that may stretch out for decades. Even before the pandemic sent older workers off payrolls, the Federal Reserve report on the economic well-being of U.S. households was shattering.
One-fourth of non-retirees indicated that they have no retirement savings, and fewer than 4 in 10 non-retirees felt that their retirement savings are on track. Nearly 6 in 10 non-retirees with self-directed retirement savings expressed low levels of comfort about making retirement decisions.
Couple that financial insecurity, with the ageism that creates a deep chasm for all generations now and in the future, who want, or need to, stay on the job past age 65, and it’s bleak.
Ageism is deeply rooted in the workplace. Covid-related early retirements stemming from layoffs are rolling out rapidly. The dearth of job opportunities and sluggish hiring for those over 50 by employers is noteworthy. That’s a slippery slope.
We’re on the cusp of a soaring scenario of elder poverty if we can’t make some big changes in our workplace culture. I fear that the country’s social safety net will be unable to cope in the coming years, as the boomers move into their later decades in droves and grapple with financing longer lifespans and rising medical bills with inadequate resources.
Read more MarketWatch retirement news
Remote work to the rescue
I do see glimmers of light coming from the pandemic for older workers.
Remote jobs are here to stay. The genie is out of the bottle. Employers have found it works in terms of productivity and cost-savings. And for older workers, not being “present” in the workplace can go a long way to combating the ageism that subtly percolates up from hiring managers judging a book by its cover and labeling you old because your hair has some gray, and your skin is not as smooth and taut as a younger co-worker.
Instead, you’re judged on your performance. And for those workers with health issues that can impact mobility, not having a commute to the office can be a gift of time and open the door for jobs that you couldn’t have traveled to or handled in a traditional office environment.
Downside: These tend to be white-collar jobs, and moving forward, I suspect many will be contract positions which let employers off the hook for paying benefits like health care and providing access to employer-provided retirement plans, which is not such a good thing.
But have no doubt, the workplace is transforming before our eyes. And jobs are the story, as populations world-wide continue to age and confront the impact of longevity and financial security.
What skills do we need?
Employers, higher education and the public sector leaders must come together to deliver the training and upskilling necessary for older workers to stay in the game. These initiatives and training efforts may result from employer partnerships with community colleges and other workplace development organizations, some of which are already under way.
I reached out to WorkingNation’s editor in chief Ramona Schindelheim for some insights on this issue. WorkingNation is a nonprofit founded four years ago by venture capitalist Art Bilger to explore the looming job skills gap and unemployment. Schindelheim has been tapped as a thought leader working at the intersection of aging and longevity by the Encore Public Voices Fellowship.
“I am over 50,” said Schindelheim. “What really bothers me is there are stereotypes about older workers that they cannot understand technology, are not good companions in the workplace; they are fussy, slow, not hip. It is so ridiculous. Older workers are just as capable as younger workers to learn new skills.”
Employers who don’t realize this “end up not hiring the best person for the job,” she said. “There are so many attributes that an older worker can bring to a workplace that shouldn’t be discounted, or eliminated because of stereotype.”
(For more on older workers, you might check out this interview. Ruth Finkelstein, the executive director of the Brookdale Center for Healthy Aging, sits down with Schindelheim, to talk about the obstacles facing older job seekers, particularly those from underserved communities.)
The majority of Americans (63%) believe that technology is rapidly changing the way we do our jobs, but they say they don’t have the skills they need to keep up with these changes, according to the recent WorkingNation American Workers Survey.
“In light of the pandemic, the change in the way we work is accelerating and the path to future jobs and careers will look different than it did even a few months ago,” Schindelheim said.
“When we come out of this on the other side, the people who have taken this time to learn new tech skills though online courses are going to be better positioned to find work,” she said. “People have to be adaptable.”
Educators and training program operators, though, need to be clear on what their programs offer in terms of actionable skills that employers want. And once armed with these credentials—whether it is a degree, a certificate, or a license—workers have to figure out how to signal to employers they have these skills,” she said.
Even as skills development is now deemed as a vital piece of landing and retaining a job at all ages, more than half of the workers surveyed (56%) are unaware of existing programs to acquire in-demand skills, or how to find existing programs, according to the survey.
Networking vs not working
While the crux of landing a job for older workers often spins around the tech skill scepter. The one big factor they do have in their back pocket is a big network of contacts to ask for help.
That’s why I was disheartened to see a new LinkedIn survey of 2,000 U.S. professionals between the ages of 18 and 74 who became unemployed mid-March and mid-October, and admit that they have not been actively networking while being unemployed.
Seriously.
Less than half of survey respondents (42%) say they’ve reached out to current connections and only 39% say they’ve asked people in their networks, such as friends and former colleagues, for introductions to other people. Only about a third (35%) have been making their own introductions to new contacts.
As I constantly say, networking is just one letter away from not working. Networking is how people find jobs. Employers hire people they know, or people they know know. Referrals matter big time.
One reason for the aversion to networking, according to the LinkedIn findings, is that 84% believe there is a stigma associated with being unemployed. They’re ashamed or embarrassed by it.
Pluck up your courage. Help is another one of those good four-letter words.
Kerry Hannon is a leading expert and strategist on work and jobs, entrepreneurship, personal finance and retirement. Kerry is the author of more than a dozen books, including Great Pajama Jobs: Your Complete Guide to Working From Home, Never Too Old To Get Rich: The Entrepreneurs Guide To Starting a Business Mid-Life, Great Jobs for Everyone 50+, and Money Confidence. Her on Twitter @kerryhannon.
