Special Report: Reinventing Retirement by Peter Keating (Author Archive)
http://www.smartmoney.com/Personal-Finance/Retirement/Second-Time-Around-for-Retirees/The Second Time Around for Retirees
Here’s a sign of the times:
Enrollment at the American Bartending School in New York City has shot up, and some of its new students are in their 50s, from retired social workers and laid-off investment bankers to fashion designers looking for extra income. More than ever, thanks to the ongoing economic downturn, planning for and living through retirement requires a second job or new career, even if that means learning how to mix a grasshopper. Older Americans actually have excellent long-term employment prospects, and since we could all use some good news, let’s look at that fact first. As boomers retire, millions of jobs are going vacant every year—more than younger workers can fill and more than companies can downsize out of existence—and many are being taken by boomers who don’t retire.
Experts disagree about just how severe a labor shortage the country faces in the coming years, but these demographic facts are already keeping or pulling back a record number of older Americans into the work force. The labor force participation rate of workers aged 65 and older, after dropping for decades, began rising in the mid-1990s. The percentage of seniors working full-time started increasing around the same time and continues to climb. And from 2006 to 2016, the federal government projects that while the number of workers age 16 to 24 will drop, those age 55 to 64 will jump by more than a third—and those 65 and older will rocket more than 83 percent. As a July 2008 report by the Bureau of Labor Statistics puts it, “The graying of the American work force is only just beginning.”
An aging population of consumers presents new job opportunities, too. The increasing use of medical services is already generating a staggering need for nurses and medical technicians. When it comes to financial services and retail management, older customers tend to seek advice from older employees, creating openings in all sorts of sales jobs. Workers looking for retraining and advanced degrees are driving a need for more teachers and adjunct instructors at colleges. Restructuring companies shedding redundant operations and expensive employees are looking to hire consultants and contractors. When the economy starts growing again, these are all likely to be booming fields.
Further, businesses are finally waking up to a realistic assessment of the benefits of older workers. Employers traditionally have assumed that older workers, because of their greater experience and longer tenure, are much more expensive than younger employees. But it turns out that older employees are also, on average, more motivated, less prone to turnover and more willing to work on flexible schedules. In 2005, Towers Perrin, looking at the energy, financial services, healthcare and retail industries, found that if firms where 20 percent of new hires are age 55 and older double that proportion to 40 percent, their total compensation costs would rise less than 1 percent. With numbers like that added to their anecdotal experiences, many firms have begun outreach programs to keep or find older employees.
That’s the good news. The bad news, obviously, is that for the moment and into the foreseeable future, all these trends will probably be swamped by a national economic slide that is destroying hundreds of thousands of jobs every month. There could hardly be a worse time to walk into a bank and ask about a job or to launch a custom-design-guitar Web site you’ve been doodling about. The best response, as always, is to assess your needs honestly, then control what you can, which in this case means reducing what you invest in a second job or career. If you require significantmonthlyincome just to meet your expenses, this is no time for speculative ventures. You might contact your old company or similar businesses and try to land a consulting deal or some kind of work where you can put your long-built skills to use. And in the meantime, don’t turn up your nose at local customer-service gigs; bookstores and coffeehouses often need reliable help who can work flexible schedules.
If you need a financial boost to feel better about meeting your long-term goals, be careful about what you spend, because returns on just about every investment are dubious at best in this economy. Bartending school? Sure; it’s brief and cheap. Veterinary-technician school? Maybe; there’s a real need for skilled help in that field. Broadcasting school? Probably not. Finally, if you are looking for work more out of a need for purpose than cash, consider public service, where opportunities abound and employers will teach you what you need to know. One great example: the Peace Corps, which is so keen to attract 50-and-older volunteers that it’s been recruiting at Lions Club and AARP chapter meetings....
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