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This is the sixth post of my series about preparing your organization for the future of work. In each post, we look at a data-based trend that is or will be disruptive to work as we know it. In the last post, we explored the disruption to traditional career development processes. Today, we examine the impact of longer life expectancies on the workforce.
Future of Work trend #6: Increasing life expectancies
In 1950, the average life expectancy in the United States was 68.2 years old. Just making it to the 65 year old retirement age was no guarantee. I suspect it was during this era that the notion of “early retirement” became so appealing.
Today, we are living to 78.7 years old on average and despite some slight declines over the past two years, that number has been steadily increasing for as long as it’s been measured. And, the percentage of people living into their 80s and 90s has steadily increased as well.
In contrast to the 1950’s, a large majority of people today live a decade or two beyond retirement age. This raises questions for many people about not only having enough financial resources to sustain a standard of living, but also what to do with the new found free time retirement affords.
Confronting the reality of living longer is changing our expectations about retirement. A 2017 Gallup study shows just how much things are changing:
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74% of Americans plan to work past retirement age
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63% say they will continue to work, but work part-time
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The number reporting they will retire after age 65 is increasing
What does the increase in life expectancy mean for organizations?
There seem to be two big implications in these trends. First, it’s not a given that most employees will be ready or interested in retiring as soon as they become eligible. While a majority of Americans are still planning to retire from their full time job at or before age 65, that number is shrinking.
Second, even for those who do retire at 65, it appears that most expect to continue working in some capacity beyond that. But, that doesn’t mean staying with their employer. People 65 and older are more likely to be self-employed than any other age group.
How can HR prepare for the Future of Work now?
The past decade or more has been dominated by discussions in HR about how to prepare for the coming exodus of baby boomers from the workplace due to retirements. But, what if they don’t retire when we expect? Or what if we could offer them part-time “bridge employment” to stick around for a few more years?
This trend is already impacting your workforce and it’s not going anywhere. If you want to take advantage of what can be a great opportunity, consider the following suggestions.
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Treat retirement planning as seriously as you do development planning. The best way to predict and work with employees on a successful retirement transition is to partner with them to co-create a plan and update it regularly. In my experience, the older an employee gets, the less attention and effort is devoted to their career planning. This needs to change. The conversation about career development needs to be active while approaching and through retirement, including discussions of goals and expectations for working beyond that point.
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Double down on schedule and work flexibility. If you want to benefit from the wisdom and talent of retirees, flexibility is a must. One of the messages we can take from the trends is that people plan to work past retirement, but they expect work at that point to happen more on their own terms.
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Design meaningful part-time assignments. Traditionally, part-time jobs were dedicated to less critical, less complex tasks. To attract and transition your retiring workers into ongoing bridge assignments, this stigma must be confronted and overcome. Retirees will work because they want to, so the part-time opportunities you offer them must be appealing and fulfilling.
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Create and promote benefits that meet the needs of older employees. As we age, our needs change. A young, single employee values different benefits than a middle-age employee with kids in high school. The same is true for employees nearing or past retirement age. As you approach employee engagement and benefits planning, consider bringing together a steering committee of older employees to provide guidance and feedback on what they value the most and how to create a better experience for them.
The fact that we are living longer and wanting to work longer can be an opportunity for your organization. To capitalize, you’ll need to spend more time and energy engaging with your older workers to ensure you are creating an employee experience that’s working for them and opportunities that make them want to stick around.
