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Study of Older Americans Finds Retirement More a
'State' Than a 'Date'
Limited savings,
longer life conflict with desire for self-employment, part-time work
April 3, 2006 Older workers today are changing
the concept of retirement as they live longer and work well past
traditional retirement age - some even returning to the workforce after
they "retire" and/or opting for "portfolios" of paid and volunteer
positions, according a new MetLife Mature Market Institute study, Living
Longer, Working Longer: The Changing Landscape of the Aging Workforce.
As an example of the state of retirement, this study says 37 percent of
those age 66-70 are either working of looking for work.
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The survey conducted by David DeLong & Associates,
Inc. and Zogby International, joins a growing stack of research and
information showing older Americans are continuing to work after normal
retirement age, many because they want to keep their bodies and minds
active and others who need the income for daily living.
Unlike other industry studies which have offered
predictions of the aging Baby Boomers' retirement expectations, the
MetLife "Living Longer, Working Longer" study examines the actual work
experiences of employees age 55-70. The study findings were unveiled
today at a symposium hosted by MetLife and the International Longevity
Center-USA.
"Today, older workers view retirement as a
desirable state, not a particular date," said Dr. David DeLong, author
of Lost Knowledge: Confronting the Threat of an Aging Workforce and a
research fellow at the MIT AgeLab.
"When we conducted the study, we found that mature
workers are struggling to balance the conflicting pressures of income
security, post-retirement-age employment and, often, age discrimination
- perceived or real - as they look for a sense of security and meaning
during their 'retirement' years."
The Working Retired
The study found that 78% of respondents age 55-59
are working or looking for work, as are 60% of 60-65 year-olds and 37%
of 66-70 year-olds.
Across all three age groups, roughly 15% of workers
have actually accepted retirement benefits from a previous employer, and
then chose to return to work (or are seeking work).
These employees, who have become known as the
"Working Retired," represent 11% of 55-59 year-olds, 16% of 60-65
year-olds and 19% of 66-70 year-olds.
Motivations for Work
Employee motives for returning to and/or remaining
in the workplace differ significantly by age. Among workers age 55-59,
economic incentives take precedence, with 72% of employees in this age
bracket citing "need income to live on" as a primary reason for working.
Economic incentives were also the number one motive
cited by 60-65 year-olds (60%), followed by a desire to "stay active and
engaged" (54%) and "do meaningful work" (43%).
Among 66-70 year-olds, however, 72% of employees
cited the desire to "stay active and engaged" as a primary reason to
work, followed by "the opportunity to do meaningful work" (47%) and
"social interaction with colleagues" (42%).
Redefining Retirement
The MetLife study found that retirement isn't
necessarily defined by an employee's age or work status. When asked what
retirement means, many respondents indicated "freedom from the demands
of work" (26%), followed by "more control over one's personal time"
(24%) and "limited financial concerns" (21%). Another 12% of respondents
identified "the ability to pursue other opportunities" as their
definition of retirement.
"As organizations seek to attract and retain older
workers, they must be careful not to lump all 'older workers' into the
same category - it's important to differentiate the work experiences and
motivations of these employees. While some may be working for financial
reasons, others place a special premium on feeling engaged and doing
work that means something," says Sandra Timmermann, Ed.D., gerontologist
and director of the MetLife Mature Market Institute.
"Recruiting and retaining older workers requires
careful consideration of job design, work environment, and creating new
and challenging opportunities."
"Working Retired" on a Quest for Meaning
Among the Working Retired - i.e., employees who are
receiving retirement benefits and subsequently returned to work - the
quest for meaning is one of the major forces drawing them back into the
workplace.
Among Working Retireds age 60-65, the number one
reason cited for taking retirement benefits was "wanted to try something
new and different" (20%).
This option was cited much less frequently by 55-59
year-olds (12%) and by 66-70 year-olds (7%), suggesting that workers in
their early sixties, who may be in a transitional period between
full-time work and retirement, are particularly eager for new
experiences and challenges.
"Becoming self-employed or starting a business" was
another common reason for taking retirement benefits - cited by 19% of
66-70 year-olds, 7% of 60-65 year-olds and 8% of 55-59 year-olds.
Overall, some 28% of respondents age 55-59 listed
themselves as "self-employed or business owner," exceeded only by 34%
who reported working for a "private sector business." More than
one-third (36%) of 60-65 year-olds and 42% of 66-70 year-olds report
being self-employed or business owners.
"Clearly, these findings suggest there are
conditions in the job market and in older workers' desire for autonomy
and flexibility that make self-employment an attractive option for those
in their late sixties," said Dr. DeLong.
"As the oldest Boomers turn 60 in 2006, their
desire for autonomy and trying new things could portend a significant
wave of departures in the next five years. Employers will need to
identify ways to retain the valuable knowledge of these workers."
Financial Reality Sinks In
While aging workers crave autonomy and flexibility,
financial necessity is driving many older employees to work, whether on
a part-time, full-time or self-employed basis. A significant portion
(18%) of Baby Boom workers age 55-59 report that they expect to have no
access to retirement benefits (e.g., pension, 401(k), SEP) when they
stop working and are likely to feel compelled to work well past
traditional retirement age. About 14% of workers age 60-65 and 10% of
workers age 66-70 expect to receive nothing but Social Security when
they finally stop working.
"Retirement experts have been predicting for years
the serious repercussions that will arise as Baby Boomers' lack of
retirement assets collides with their increased longevity to create
widespread economic hardship. The rational solution - to continue
working full-time beyond traditional retirement age - is at odds with
many Boomers' interests, values and priorities for their retirement,"
notes Dr. Timmermann.
Among the other key survey findings:
★
Help Not Always Wanted: In addition to the financial pressures, many
aging workers face an additional barrier to workplace fulfillment: the
perception of age bias. When asked about unsuccessful job searches,
older workers most frequently gave reasons suggesting or implying "age
bias." Employees age 55-59 blamed "age bias" 39% of the time, while
60-65 year-olds and 66-70 year-olds identified bias as a barrier 42% and
60% of the time, respectively.
★
Part-Time Preferred as Workers Age: Of those still in the
workplace, about 76% of 55-59 year-olds work more than 35 hours a week,
and only 39% of 66-70 year-olds work that much. Nearly four in 10 (39%)
of those age 66-70 are working fewer than 20 hours a week. Among those
seeking work in this age group, 56% wanted less than 20 hours per week.
★
Portfolio Work: In interviews done for this study, some older
workers talked of their lives as taking on a "portfolio quality" - a mix
of part-time work for pay, volunteer work, and travel, along with more
time for hobbies and family. Supporting this portfolio metaphor, 25% of
survey respondents across all age groups currently earn income from more
than one job. About 20% of those working have two jobs, and another 4%
have three jobs.
★
Staying Put: Stereotypes to the contrary, only 15% of 66-70
year-olds moved to warmer climates once they started receiving
retirement benefits, while 21% of 60-65 year-olds and 28% of 55-59
year-olds chose to relocate. Among employees who had access to
retirement benefits when they were younger, relocation rates are
somewhat higher.
★
A Healthy Aging Workforce? Approximately half of all respondents
surveyed characterize their health as excellent or very good - 49% of
66-70 year-olds, 52% of 60-65 year-olds and 54% of 55-59 year-olds.
These findings indicate that the aging workforce appears to be healthy
enough to handle the physical demands of work, at least for the
foreseeable future.
About information source:
The MetLife Living Longer, Working Longer Study was
conducted for the MetLife Mature Market Institute by David DeLong &
Associates, Inc. and Zogby International during the first quarter of
2006.
The survey polled 2,719 respondents between the
ages of 55-70. To supplement the survey data, a small sample of
additional interviews were conducted with people who fit the survey
profile, as well as with company managers responsible for workforce
diversity and experts in recruiting older workers.
The MetLife Mature Market Institute is MetLife's
information and policy resource center on issues related to aging,
retirement, long-term care and the mature market. The Institute, staffed
by gerontologists, provides research, training and education,
consultation and information to support MetLife, its corporate customers
and business partners.
MetLife, a subsidiary of MetLife, Inc. (NYSE: MET)
is a leading provider of insurance and other financial services to
millions of individual and institutional customers throughout the United
States. Through its subsidiaries and affiliates, MetLife, Inc. offers
life insurance, annuities, automobile and homeowner's insurance and
retail banking services to individuals, as well as group insurance,
reinsurance and retirement and savings products and services to
corporations and other institutions. Outside the U.S., the MetLife
companies have direct insurance operations in Asia Pacific, Latin
America and Europe. For more information, please visit
www.metlife.com.
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