Sunday, March 4, 2012

Don't Retire, Retrain: Decreasing the Dependency Ratio

Photo by JD Lasica
How will the US pay for the growing number of citizens 65+?   Many gloomy projections assume that older adults no longer contribute to the economy.   They are factored in census dependency ratios along with minors ages 0 to 17 who are largely incapable of making a contribution to society through earning wages or through volunteer work.  Labeling all adults 65+ as dependence on par with minors enacts a gross generalization. 

In 2010. the U.S. Census Bureau predicted that “the number of people 65 and older to every 100 people of traditional working ages is projected to climb rapidly from 22 in 2010 to 35 in 2030.”  However, economic factors and personal factors make it likely that older adults will work either for pay or as volunteers for more years and into higher age brackets than their own parents did.

Some of these factors include the increase age for full benefits of Social Security, the depleted retirement accounts based on poor stock market performance, poor real estate performance,  increased longevity, and improved health of older adults.   Working beyond 65 isn't always just an economic necessity. Many have the drive to share their talents rather than spend decades in leisure activities.

Older adults who work and otherwise stay socially engaged have lower rates of depression and higher general levels of health.  And they have hard-won wisdom to contribute to the workplace and their communities.   An encouraging vision for a multigenerational workforce is one forged by Marc Freedman, author of Encore: Finding Work that Matters in the Second Half of Life.  He has identified a number of predictors for the role of older workers in our near-future economy.  To cite just one, Bridgspan, a consulting firm that works extensively with nonprofits, predicts that by 2016, “these organizations will need almost 80,000 new senior managers per year.”  

However, certain challenges exist for older workers.  For older adults to maintain a commanding presence in the workplace, they need to retool—as do workers of all ages.  Government funded job training programs are designed for the poorest among older adults, those earning 125% of the poverty rate or lower.  Recipients of these training programs have the potential of receiving a return on their investment by moving trainees off government assistance and into tax-generating jobs.   

The Aging 4 Action Network recognizes that older Americans have a lot to offer society as they move into their 60s, 70s, and even into their 80s and beyond. They recommend that the Senior Community Service Employment Program(SCSEP) not only continue job training for re-entry in the work place; they also recomment that the SCSEP work together with programs from other areas of the Older Americans Act “to create a national strategy to tap older volunteers as a source of social capital to meet critical community needs.”   

Recognizing that older adults need job training tailored to changes to their cognition, Neil Charness and Sara Czaja offer research-based guidelines in their 2006 report Older Worker Training: What We Know and We Don’t Know.  “In order to keep pace with changes in jobs and job demands, workers need to constantly learn new skills and new ways of doing things. However, older workers usually have not had recent training.”  

Equipped with the right training, older adults can meet these needs and others with a little leg up from a variety of sources, including but not limited to government social services like SCSEP. Corporate training and classes offered in college environments can also help provide ongoing job training.  In return, these older workers will bolster tax revenues and reduce dependence on government programs. Those who work as volunteers will also address budget shortfalls with their labor capital.  

In other words, the 18-to-64-year-old workforce need not shoulder the entire burden of supporting our graying society.  Many people 65+ can offer significant help.

How old were your grandparents when they stopped earning a paycheck? How old were your parents? How old do you plan to be when you stop earning a paycheck? Will you have enough in Social Securities, 401Ks, and savings to meet the rising costs of medical care and long-term care? Leave a comment below.


Easing Into Retirement
Encore Careers: Live to Work instead of Work to Live
Age-Related Changes to How We Write
Full SS Benefits at 65 No More
Older Americans 2012 Federal Report


  1. Nice blog. You might like this poem about mothers.

  2. I just found this related news story on employment and the older worker:

    Using data from the Bureau of Labor statistics, the article states, "The number of people over age 55 who have a job has increased by 1.69 million over the past year, to nearly 30.2 million workers."