With their pensions down and their medical bills up, a growing number of Americans are updating their CVs, coming out of retirement and heading back into the workforce
GLEN COOPER has been unemployed for a year but he’s working hard trying to find a job, sprucing up his resume, making online applications and keeping his ear to the ground for possible openings.
Despite the worst economic downturn since the Great Depression, he’s confident of finding work before long, not least because he has the kind of skills any employer would welcome.
“I’ve a tremendous amount of background and experience,” he says. “I’m very good at decision-making, planning and making things happen.” Cooper admits, however, that his job search is moving more slowly than he would like – perhaps because he is 79 years old.
He’s one of a growing number of Americans who can’t afford to leave the workforce because their retirement savings are too small to live on as medical bills and other expenses soar. The recent plunge in the stock market has left many older Americans watching their pensions shrink – sometimes by as much as 40 per cent.
In Cooper’s case, he has simply outlived his savings so that he now has enough to live on for just two years unless he finds work. “When I retired, I thought I’ll buy my last car because I won’t live longer than that,” he says. “That was 1993 and I’m healthier now than I was then.”
In a low, whitewashed building on the outskirts of Akron in northeastern Ohio, Pat Bedell was among dozens of senior citizens peering into computer screens, talking into headsets or meeting in break-out groups.
This is the Senior Employment Center, a division of the non-profit Mature Services that trains seniors in new skills and helps to find them work with local employers.
An energetic 67-year-old blonde with an impish manner, Bedell appeared at first to be playing a video game. In fact, she was taking an online aptitude test before filling in an application for a job at a local grocery store.
“I knew nothing about the computer,” she says. “I didn’t know how to turn it on.”
After more than 40 years teaching tap dance, Bedell gave up work to take care of her grandchildren but after a year she realised that the dream of a leisurely retirement was out of her reach.
“That’s what I thought I’d be doing. But in this economy I can’t do it. I don’t get enough social security and living expenses are too high,” she says. “Basically, I’m poor.”
In another part of the building, Minnie Miller was training as a call centre operator, calling employers to tell them about the Senior Employment Center’s services.
A youthful 66-year-old, Miller returned to Akron to care for an ailing uncle before he died last year but now she’s ready to return to the workplace. “I’d love to work another five or 10 years, depending on the job market,” she says.
“And there are companies that are willing to hire older adults because we’re living longer and because of the expertise we have and we know what we want and this is what they’re looking for.”
A former social worker with a master’s degree in gerontology, Miller would consider almost any job except waitressing or home nursing assistance. “Getting older, the lifting and everything, it gets harder,” she says.
The proportion of Americans over 65 in the workforce has increased by almost 50 per cent in the past decade to 17 per cent and the number of workers over 75 has almost doubled to nearly 8 per cent. Three in 10 Americans between 65 and 69 were working or job-hunting in 2007, up from two in 10 in 1982.
THE RISE IN OLDER Americans seeking work has coincided with the decline of the traditional, defined benefit pension – which only one in five US workers now enjoy. The most common form of pension today is an Individual Retirement Account such as a 401(k) that allows workers to defer paying tax on retirement savings deducted by their employer.
Some employers contribute to their employees’ 401(k) accounts, most of which are invested in the stock market, so that many have lost much of their value in recent months.
Even before the decline in the markets, most Americans’ retirement savings were inadequate, with the typical household aged 50 or over holding a balance in their retirement account of less than $90,000 (€71,000) – enough to buy an annuity worth about $700 (€550) a month.
Half of American workers – many of them in low-income or temporary jobs – have no retirement savings at all and no traditional pension.
The bursting of the housing bubble has left many older workers exposed too, with some facing the prospect of paying off their mortgage for the rest of their lives.
With social security – the federal pension system – providing only about 40 per cent of what most people need to live on and medical expenses swallowing up 15 per cent of seniors’ incomes, the prospect of traditional retirement is receding for most.
“It’s hard to imagine in some ways, unless you really, really had a lot of money, that you could traditionally retire,” says Paul Magnus, who heads Mature Services workforce development division.
“I think people have to be realistic. They may have to lay aside that option in many cases or they will want to work part-time to keep some money coming in.”
Magnus says that the economic downturn has brought more seniors out of retirement in recent months, including some unexpected jobseekers.
“We had a 100-year-old woman coming into our office in Cleveland looking for work,” he says. “I think her 82-year-old son talked her out of it. But she showed up for an orientation and was interested in it.”
Although many firms have shed workers over 50 in recent years, partly because they are more expensive than their younger counterparts, others are happy to employ mature workers and the Senior Employment Center has a database of friendly local employers.
“Age discrimination is alive and well but we teach older workers how to use their age as an asset,” says Magnus.
“I think older workers help stabilise a work environment. I think they have a very positive effect on the younger workers. There’s some natural mentoring that happens. Also, that whole institutional knowledge that they have is very valuable.”
Trainees at the Senior Employer Center are paid the minimum wage through the government-sponsored Senior Community Service Employment Programme – although the scheme only has enough funding to meet the needs of 1 per cent of those who are eligible.
After about a year of working 20 hours a week on the programme, seniors are supposed to find work in the private sector.
Among the centre’s most successful projects is its Job Club, a three-week job-seeking skills course covering topics such as writing a CV, doing an interview, networking and targeting unadvertised jobs.
“When they come in, you’re dealing with a wide range of emotions – anger, hurt, scared,” says Don Zirkle, who runs the Akron Job Club.
“The first week, it’s just getting the tools ready and dealing with emotions. The second week, they’re heading in the direction they need to go. The last week, they’re flying. They’re not totally over the fear but they know they have a support base.”
BARACK OBAMA’S budget proposal, unveil- ed last month, would encourage more retirement saving by making enrolment in an employer-sponsored 401(k) plan automatic.
Such legislation would do nothing, however, to prevent workers from taking money out of their retirement accounts before they retire and would not, of course, protect the value of such accounts from fluctuations on the stock market.
Bedell, who cheerfully admits that she saved nothing for retirement while she ran her tap dance studio, is resigned to working for many years to come.
“I could work in an office as a receptionist. I could work in a grocery store. I also was a banquet server for 15 years so I still could go maybe in the office work of that, doing parties and weddings and things like that,” she says.
“Unless I find a rich husband. At 67, I don’t think so.”