Nearly 7 in 10 American workers
report that they plan to continue to work full- or part-time for pay following
retirement from their main job, according to a new national survey of American
workers. Another 14% plan to work as volunteers. Only 13% of employees expect
to stop working entirely.
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Employees are also suspicious
that employers favor younger workers over older workers in the workplace.
Moreover, 4 in 10 American workers disagree that Social Security and Medicare
will still be available when they retire; only 20% strongly believe that both
programs will be a source of support when needed.
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The survey and report, titled
A Work-Filled Retirement: Workers’ Changing Views on Employment and Leisure,
is the 16th survey in the Work Trends series, a national survey that
explores attitudes of the U.S. workforce. The Work Trends survey polled
800 American workers between May and mid-June 2005. The full report can be
accessed on the Heldrich Center Web site at www.heldrich.rutgers.edu.
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As America’s influential “Baby
Boom” generation approaches retirement age, the typical work-free retirement
is yielding to an increasingly common work-filled retirement.
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“The traditional notion of retirement,
where one stops working completely and enjoys leisure time with friends and
family, is obsolete,” notes Carl Van Horn, Director and Professor of the Heldrich
Center for Workforce Development at Rutgers University, and Co-Director of
the Work Trends project. “In fact, workers in 2005 feel less confident
than they did in 2000 that they will be financially able to leave the workforce
ahead of traditional retirement age."
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A Work-Filled Retirement finds deepening concern among workers about their ability
to retire early, if at all:
• 6 in 10 respondents now
believe they will not be able to retire from full-time work by age 60,
including 12% who say they will never be able to retire. In contrast, in 2000
at the end of an economic boom, only 40% of workers surveyed doubted they could
retire by age 60, with 7% saying they would never be able to retire.
• Only a quarter of workers
are “very confident” they can retire when they want, down from 29% in 2000.
• Workers between the ages of
35 and 54 are the least sure of their ability to retire when they want.
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Treatment of Older Workers in
the Workplace
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The Bureau of Labor Statistics
estimates that between 2002 and 2012, the number of workers 55 years and older
is expected to grow by nearly 50%, far outpacing increases in the number of
workers aged 16 to 54. By 2012, workers 55 years and older will make up about
20% of the labor force (Toossi, 2004). As the presence of older employees
in the workplace becomes more common, many workers worry that they may become
targets for discrimination or “ageism” by employers.
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The Work-Filled Retirement
survey found:
• 71% of American workers
believe older workers are more likely to be laid off when a company reduces its
workforce. Interestingly, these views are at odds with independent data from
the U.S. Department of Labor demonstrating that workers under 40 have had higher
layoff rates than those over 40 over the past 20 years (Farber, 2005).
• 44% believe older workers
are treated unfairly when employers are making hiring decisions.
• 86% believe younger workers
that are laid off are more likely than older employees to find new jobs that have
the same or better pay than their previous jobs.
• A majority of workers do not consider
themselves to be “older” workers until at least the age of 60. However, they
believe employers classify workers as “old” at much earlier ages. Nearly 40%
of workers think that employers begin to view a worker as old by the age of
50.
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Attitudes Toward Retirement
Income Security
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The survey comes at a time of
heightened attention to retirement issues, particularly income security. A
protracted national debate on the future of Social Security is underway. President
Bush has proposed reforming the 70-year-old public retirement program and
Congress is now considering legislation.
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Moreover, government reports
have documented the worsening conditions of many private sector pension plans.
According to the U.S. Pension Benefits Guaranty Corporation, 60% of those
plans are underfunded (Pension Benefit Guaranty Corporation, 2005), a dramatic
rise from the 19% underfunding level in 2000 (Pension Benefit Guaranty Corporation,
2003).
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A Work-Filled Retirement finds that many employees lack reliable sources of retirement
income:
• 39% of workers believe they
themselves are primarily responsible for securing their retirement income, compared
with 25% who cite employers and 18% who cite government.
• Yet, 35% currently save
nothing to supplement expected Social Security payments.
• 46% agree they are doing a
good job of saving for retirement, down from 52% in 2000.
• Among those eligible for an
employer-sponsored retirement or pension plan, 51% are “very confident” their plan
will yield the benefits they expect upon retirement. (That level of confidence
is remarkably high given the weak condition of many private sector plans.)
• Among workers who had
retired but are still in the workforce, 54% said they went back to work because
they needed the income. They did not choose to give up full-time retirement
voluntarily; working was a necessity.
“An alarming number of U.S.
employees are saving nothing for retirement beyond their Social Security contributions,”
observes Dr. Van Horn. “This is deeply troubling, given that almost half of the
working Americans we surveyed are unsure if Social Security will still exist
when they retire.”
“There is a real danger that
many Americans will reach retirement age without sufficient resources to support
themselves,” adds Neil Ridley, Managing Director at the Heldrich Center. “A
large number of workers say they will rely more on ‘employer-sponsored retirement
plans’ and ‘personal savings’ than on Social Security for their retirement
income. Yet, the fact is that many of them are not currently saving anything
to supplement Social Security."
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Uncertainty Persists As Economy
Recovers
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Despite signs that the U.S.
economy is growing, workers remain concerned about economic conditions:
• 53% still say that “now is
a bad time to find a quality job.” This level of pessimism has fallen from its
fall 2004 level and is well below its peak in the spring 2003 Work Trends survey.
• 45% of workers are “very
concerned” about job security for those currently working, an increase from the
fall 2004 survey figure and near a seven-year high for the Work Trends series.
• 51% of “Baby Boomer”
workers aged 41 and 59 years are very concerned about job security, compared with
41% of mostly younger workers.
• 52% of working women are
very concerned about job security, compared to 39% of men. “Employee concern
about job security is at one of the highest levels we’ve seen since the Work
Trends surveys began in 1998,” notes Samuel Best, Director of the Center
for Survey Research and Analysis at the University of Connecticut.
“Many American workers remain
anxious about their jobs and futures,” concludes Van Horn. “Yet, employees also
display surprisingly high levels of confidence that they will have adequate
funds to support them during retirement.”
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