Today’s senior citizens are actively looking for options to remain in the workforce. The challenge for organizations is to design work arrangements that are adequately appealing to this loyal, experienced talent pool.
Some people work in retirement because they need the money.
Extended life expectancies lead to more years in retirement, and that often means nest eggs that could use some additional padding. But many working retirees say they enjoy the opportunities to socialize, mental stimulation, and feeling like they are a vital part of the organization, according to a 2018 Merrill Lynch survey. In fact, research from AARP revealed that 80% of baby boomers say they would defer their retirement if they could work on a less rigid schedule.
These older workers constitute a significant population.
While the number of people in the U.S. between the ages of 25 and 54 has dropped over the past two decades, those between the ages of 55 and 65 has increased by more than 73%. Currently, over 40% of Americans over the age of 55 are employed, comprising nearly 30% of the U.S. labor force. As the older population continues to grow, so will the percentage of people who want to keep working beyond the traditional age of retirement.
Many times, the choice to keep working revolves around a family situation.
Research indicates that married couples often coordinate their decisions to retire. In a large number of cases, caregiving responsibilities rest with the older worker. A 2015 Conference Board study found that 23% of older workers care for an elderly parent, 22% care for a spouse, 21% care for a school-age child, and 8% care for some other dependent. In these common scenarios, a flexible work schedule allows mature workers to provide the necessary care to loved ones while they continue to earn a living.
Flexible work arrangements generally encompass three key elements:
- When to work. This includes flextime, in which employees have flexible start and stop times or can take time off during the day, but still work full-time hours each week. Other examples include compressed work weeks, where instead of working five days a week, employees work four 10-hour days, for example. Part-time work and seasonal work are also options.
- Where to work. Possibilities may include telecommuting all or part of the week
,or working in another office if the employer has more than one location.
- How to work. This may include job sharing, in which one position is split between two employees, with salary and benefits prorated. Phased retirement with reduced hours over a period of time before fully retiring is a popular option with older workers, as are temporary, contract, and project-based work.
Career flexibility, such as formal leaves and sabbaticals, is also frequently desired by senior job seekers, as are opportunities for mentorships with younger workers.
Employers can reap big rewards from offering workplace flexibility.
It’s consistently identified as one of the most effective ways to attract and retain older workers. Alternative work arrangements make particular sense for seniors because they allow valued, mature employees to remain active in the workforce while providing them the opportunity to tend to their other responsibilities. Many companies that offer flexible work schedules have found that it gives them an edge over the competition in terms of recruitment and retention. These businesses also benefit from improved employee morale and engagement, and enhanced productivity resulting from a stable talent pool.
With the graying of the American workforce, now is the time for employers to embrace flexible work arrangements.
Otherwise, businesses will find themselves riddled with inadequate staffing issues resulting from the massive baby boomer retirement exodus, as well as significant knowledge gaps and inflated payrolls necessary to retain younger workers. Older workers want—and in many cases, need—to keep working. The talents, experience, judgment, and expertise they possess shouldn’t be overlooked.
There are plenty of organizations that understand the immense value older workers bring to the table. For more information and financial guidance planning your perfect encore career, FAI is here to help. Please contact our knowledgeable, helpful advisors for more information.
About FAI Wealth Management, Inc.: Located in Columbia, Maryland, FAI focuses on helping clients create the financial future they desire by protecting their wealth, making the most of their assets, and planning for life's uncertainties. The firm combines fee-only, fiduciary-driven guidance with highly personalized, consultative financial planning and investment services that enable individuals, families, and businesses to navigate complex life transitions. Founded in 1987, FAI currently manages more than $350 million in client assets nationwide. For more information about FAI Wealth Management, please visit the website at https://www.faiwealth.com or call 410.715.9200.