More and more older workers are aiming for a phased retirement—a flexible schedule that will allow them to stay on the job part-time before fully retiring. But policies to support such programs are failing to keep pace both in the U.S. and abroad, a new report finds. This threatens to push older workers into retirement before they would like, even as some employers struggle with a labor shortage.
In developed nations, only 27% of workers age 55 and older say their employers will help them phase into retirement by shifting to part-time work, according to the report from the Aegon Center for Longevity and Retirement. Just 9% say their employer offers any type of job retraining, and half say their employer offers little or no information on how to prepare for retirement.
The U.S. is no exception: Only 25% of those age 55 and older say their employers will help them phase into retirement, and just 4% say their employer offers meaningful job retraining, the report finds.
This will prove to be a missed opportunity, Aegon concludes. As boomers age and leave the workforce certain industries like engineering and accounting will experience an acute labor shortage. Yet it does not have to be that way.
Older workers are far more loyal to their employer than younger workers. Just 17% of workers age 55 and older are considering looking for a new job in the next 12 months, compared to 37% of those aged 25 to 34, the report found. Retraining programs and an effort to help workers phase into part-time work may be a better corporate investment than recruiting new workers.
Yet employer offerings for older workers are still skimpy, according to Aegon:
- 24% offer phased retirement;
- 21% offer less demanding work;
- 19% offer a flexible schedule;
- 17% offer retiree healthcare;
- 14% offer retraining;
- 31% offer none of the above.
Most employers not only fail to capitalize on loyalty by retaining their older workers, they are also missing out on opportunities to hire motivated older workers from other companies. Some 63% of those aged 55 to 64 say they want to stay at work to keep active and alert, and 39% say they enjoy their work. The numbers are even higher for those 65-plus. In comparison, only a third say they want to keep working out of financial need.
The report places some blame on policymakers, who through pension and Social Security rules encourage workers and employers to think retirement starts between ages 65 to 67. Governments should hike the age for benefits and offer individuals greater inducements to delay taking them, Aegon concludes.
The good news is that more employers are realizing the advantages of retaining experienced workers. In November 2014 the federal government launched a plan to let some workers 55 and up stay on half-time while getting half their benefits. That move may encourage other employers to follow, workplace experts say.
There are other encouraging signs that the tide is turning for older workers. Recent employment data show that the unemployment rate for those over age 55 stands at just 4.1%, compared with 5.7% for the total population and a steep 18.8% for teens. Some companies are even making a special effort to woo experienced workers.
If you’re interested in a phased retirement, talk to your boss. Even if there is no formal program at your company, you may be able to work out an arrangement that meets both your needs. And if your employer isn’t open to a flexible schedule, check out part-time work opportunities elsewhere. With the right planning, you can achieve a successful second act and even have some fun.