Rearranging the life cycle - Future Focus Emerging Issues - Brief Article

HR Magazine, Jan, 2002 by Dave Patel

It's no secret that the U.S. population is aging. According to census data, 13 percent of the population is age 65 and older. By 2030, 20 percent of Americans, about 70 million, will be over 65. The population age 85 and above is currently the fastest-growing segment of the older population, growing by 274 percent over the past 25 years. And according to the Census Bureau, the elderly population will more than double between now and 2050, to 80 million.

And these older people want to work. A research initiative conducted by AARP and Roper Starch Worldwide Inc. found that 80 percent of baby boomers say they plan to work at least part-time during their retirement. Thirty-five percent say they will be working part-time mainly for the sake of interest and enjoyment, and about one-quarter say they will work part-time mainly for the income it provides.

To truly appreciate what these demographic changes may mean to the workforce, consider the following scenario: Today's average employee works for 45 years, beginning work life at about age 20 and working until the age of 65, and enjoys retirement for another 15 years. This system is tied into the fabric of American lives, affecting everything from education, compensation, taxation, health care, housing, transportation and retirement planning.

Now consider an alternative method of work, still taking into account working for 45 years but breaking that 45-year block into two or three segments. Wouldn't you rather take 10 years off at age 35, going back to work at age 45, then taking another five years off at age 60, and then working from 65 to 80? Or taking 15 years off at 45, then working until 80?

Impossible, you say.

Where would their income come from? What about health care? Taxes? Who wants to work until they're 80? All legitimate questions, but the changing realities of the aging workforce may necessitate a paradigm shift such as the one envisioned above.

Consider that today's notions of work date from the Industrial Age, our school year is based on an agrarian economy, and the health care system still focuses on prohibitively expensive medical technology, instead of investing in preventative systems that enable healthier daily living. As for working until the age of 80, consider that when President Franklin Roosevelt set the retirement age at 65, average life expectancy in the United States was 63. Life expectancy today is at 76 and climbing.

Numbers influence policies, and much of our socioeconomic life for the past 50 years has been greatly influenced by the sheer numbers of the baby boom generation. As the 80 million boomers age, what they want to do in their "retirement" years may end up redefining concepts of work and retirement. Contingent work, part-time work, portable health care, transportation assistance, focus on wellness instead of emergency medical procedures, private Social Security accounts and lifelong learning all could become commonplace.

Though the scenario envisioned above may not seem realistic, HR should seriously consider the genesis of society's institutions so that it may deal more readily with demographic and technology changes.

Dave Patel is the manager of workplace trends and forecasting at SHRM.