Friday, March 28, 2014

Survey: Tower Watson Shows More Workers Planning on Delaying Retirement Past 70

Tower Watson's annual survey of employee attitudes towards retirement finds that at workers are especially worried about the affordability of health care in retirement, and significant numbers have been forced to cut back on spending and plan to delay retirement, many until age 70 or later. According to Towers Watson’s 2013/2014 Global Benefit Attitudes Survey, while 46% of full-time employees are satisfied with their current finances—a sharp increase from 26% in 2009, 58% remain worried about their financial future. Employees’ confidence in their ability to retire has climbed with 23% very confident of their income sufficiency for the first 15 years of retirement. On the other hand, that confidence deteriorates when workers look farther ahead, with only 8% very confident of having adequate income 25 years into retirement.

With respect to delayed retirement, Tower Watson reports:
With many workers expecting to fall short on their retirement savings, nearly four in 10 plan on working longer. That’s an increase of nine percentage points since 2009. A large majority of these employees expect to delay retirement by three or more years, and 44% plan on a delay of five years or more. The profile of those delaying retirement tends toward the disengaged, less healthy and more stressed. These findings suggest a higher average retirement age in the future. In 2009, 31% of workers planned on retiring before 65, and 41% planned on retiring after 65. According to the 2013 survey, only 25% plan on retiring before 65, and half expect to retire after 65. One in three employees either does not expect to retire until after 70 or doesn’t plan to retire at all.
Tower Watson also notes that access to a defined benefit plan is a significant factor in employee attitudes: Workers without such access (and those in ill health) are consistently the most worried about their finances and retirement; workers with access to such plans are moderately more secure and more engaged in reviewing their savings, although even they continue to worry about possible changes to their plans and cuts to public programs.

Source: Tower Watson News Release (March 26, 2014)

Thursday, March 27, 2014

Northern Ireland: Commissioner for Older People Urges Government and Employers To Increase Older Workers Participation in the Workforce

The Commissioner for Older People for Northern Ireland has released a report that shows that the economy in Northern Ireland could be increased by £2.3billion by 2037 if the number of older people in the workforce increases. According to "Valuing an Ageing Workforce," which was produced in conjunction with the International Longevity Centre-UK, the government and employers should introduce ways to enable older people to remain in the workforce for as long as they wish to. The Commissioner, Claire Keatinge, says:
"This shows that older workers can be more effective than their younger colleagues and make a positive contribution in the workplace, despite widely held misconceptions that somehow productivity and output diminish with age.

"Many people will want to stay in work, for a variety of reasons, such as the removal of the previous Default Retirement Age, increase in life expectancy, and for personal fulfillment; and some will stay in work because they need to for financial reasons.

"It is essential that appropriate supports are put in place so as to enable older workers to continue to be able to play a positive role in the workforce."
Among the findings reported by the Commissioner and highlighted in a briefing note to the report are:
  1. Employers would benefit from valuing the positive role that older people play in the workplace.
  2. Employment rates for older people in Northern Ireland have increased since the financial crisis in 2008 and there is a strong economic case for working beyond 65.
  3. There are still a range of barriers which prevent people working longer, including ageist attitudes, health, caring responsibilities, skills and training opportunities, as well as the fact that ‘cliff-edge’ retirement is still a common occurrence here.
  4. Initiatives should be introduced by the Northern Ireland
    Executive and employers to support people to work longer, should they wish to do so.
  5. Older people in Northern Ireland should have the right to remain in work as well as the right to retire, and they should be supported in either scenario.
Source: Commissioner for Older People for Northern Ireland News Release (March 25, 2014)

AgeUK Literature Review Finds Someone’s Age Bears No Relation to Worker's Ability To Do Most Jobs

A literature review conducted by AgeUK reports that someone's age bears no relation to their ability or capability to perform the vast majority of jobs. Thus, AgeUK recommends that employers reconsider their existing workforce and HR strategies, and develop more effective retirement policies that place the wellbeing of their older employees at the heart of the process.

In its review, AgeUK finds, among other things that:
  • The evidence shows either a lack of relationship between productivity and age, or that older workers are at least as productive as their younger colleagues. Even in physically
    demanding situations, for example on a factory production line, age is no barrier to working productively.
  • Measuring individual productivity is challenging for researchers. Older studies, which often suggest older workers are less productive, frequently rely on outdated assumptions about aging and health, or fail to account for a myriad of other factors. More recent studies, which often find older workers are at least as productive as younger workers, are better able to account for these.
  • As people age some cognitive and physical abilities do change—however, this does not
    make older workers better or worse than younger colleagues. There is no evidence of a substantive decline in ability in most people until well past the end of a typical working life. Aging affects everyone differently, and it is not possible to make predictions about any one individual’s capability.
  • The interaction between skills, knowledge and experience means that many tasks can in fact be performed better as people age, and raises challenges for employers about how best to utilize individuals’ skills and abilities.
  • Recognizing the challenges faced by older workers and offering solutions to mitigate them, for example flexible working to help people meet caring responsibilities, can help enhance individual productivity.
Source: AgeUK "Productivity and Age" (March 2014)

Wednesday, March 26, 2014

Australia: Superannuation Conference Hears about Research Findings on Involuntary Retirement and Gen Y Attitudes about Suuperannuation

The 2014 Conference of Major Superannuation Funds sponsored by the Australian Institute of Superannuation Trustees (AIST) heard from a number of presenters about the confluence of retirement and an aging workforce. Among other things, conferees heard that:
  • A more flexible approach to retirement may be needed to account for the significant minority of older Australians who are forced to leave the workforce early. According to a research report commissioned by AIST and prepared by the Australian Centre for Financial Studies (ACFS), up to 40% of older Australians could be classified as involuntary retirees. AIST CEO Tom "Garcia said more needed to be done to help older workers stay in the workforce longer so that they had a better chance of building their retirement savings before they reached old age. Equally, there needed to be recognition that those who retired early due to ill-health were often hit with additional health-related expenses that put pressure on their savings. See AIST media release, as well as presentation by Professor Deborah Ralston, Executive Director, ACFS, Professor of Finance, Monash University on "Involuntary Retirement: Characteristics and
    Implications"
  • Research commissioned by AIST suggests that many Gen Y’s have a realistic idea of how much money they need to retire, what the Age Pension will supplement and how they want to use their money at retirement time. However, they lack the knowledge and education to understand more. See AIST media release and presentation by Michelle Tustin, Research Director, Colmar Brunton, on "Gen Y: The Messaging Wars"
Source: Australian Institute of Superannuation Trustees CMSF2014 Presentations (March 2014)

Tuesday, March 25, 2014

Age and the Technology Sector: Noam Scheiber Calls Out the "Brutality" of Ageism

In a lengthy article in The New Republic by Noam Scheiber writes about how "Silicon Valley has become one of the most ageist places in America." According to Scheiber, "tech luminaries who otherwise pride themselves on their dedication to meritocracy don’t think twice about deriding the not-actually-old." As he said on NPR: "On the engineering side, 35 really starts to be considered quite old. The computer languages change so quickly that people are quickly perceived to be out of date. On the entrepreneur side, people value experience a little more but there, even 40 and over tends to be perceived as quite old."
When taken to its logical extreme, a tech sector that discriminates in favor of the young might produce an economy with some revolutionary ways of keeping ourselves entertained and in touch at all hours of the day and night. But it would be an economy that shortchanged other essential sectors, like, say, biotech or health care.
Source: The New Republic "The Brutal Ageism of Tech: Years of experience, plenty of talent, completely obsolete
" (March 23, 2014)

Other sources: NPR All Things Considered "Weaned On Youth, Silicon Valley Keeps Older Workers On Sidelines" (March 24, 2014); CNBC "How Silicon Valley discriminates against older workers...to its own peril"; BigThink "The Brutal Ageism of Silicon Valley"

Friday, March 21, 2014

Nevada: AARP Surveys Opinions about Discrimination against Older Workers

AARP has released the results of a survey of older voters in Nevada designed to determine public views on older workers, age discrimination, and the Protecting Older Workers Against Discrimination Act (POWADA). According to "Protecting Older Workers Against Discrimination Act: A Survey of Nevada Voters Ages 50+ (POWADA)," over one-third of older voters report that they or someone they know has recently experienced age discrimination in the workplace, and 89% say it is important for Congress to take action and restore workplace protections against age discrimination.

In addition, 92% of those surveyed agree that the high cost of gas, health care, food, and housing requires many Americans to work longer in order to rebuild their retirement savings, with 78% strongly agreeing. Also, 90% agree that older Americans are putting off retirement either to make ends meet or to save money for retirement.

AARP's survey followed on a 2012 survey of older voters in Alaska, Maine, Massachusetts, Minnesota, and Tennessee.

Source: AARP Press Release (March 2014)

Wednesday, March 19, 2014

EBRI Retirement Confidence Survey Finds

According to the 24th annual Retirement Confidence Survey by the Employee Benefit Research Institute (EBRI), Americans’ confidence in their ability to afford a comfortable retirement has recovered somewhat from the record lows of the past five years, but it does not appear to be founded on improved retirement preparations. In fact, "The 2014 Retirement Confidence Survey: Confidence Rebounds—for Those With Retirement Plans" (Issue Brief No. 397) suggests that the improvement may be limited to those with retirement plans.

In the aggregate, reported worker savings remain low, and only a minority appear to be taking basic steps
to prepare for retirement. Nearly half of workers without a retirement plan were not at all confident about their financial security in retirement, compared with only about 1 in 10 with a plan.

Among EBRI's other findings:
  • The increase in confidence between 2013 and 2014 occurred primarily among those with a plan (an increase from 14% very confident in 2013 to 24% in 2014 for those with a plan, compared with level readings among those without a plan (10% very confident in 2013 and 9% in 2014).
  • The percentage of workers planning to work for pay in retirement now stands at 65%, compared with just 27% of retirees who report they work for pay in retirement.
  • Only 44% report they and/or their spouse have tried to calculate how much money they will need to have saved by the time they retire so that they can live comfortably in retirement, a level that has held relatively consistent over the past decade.
Source: EBRI Press Release (March 18, 2014)